B&N receives $204 million investment

Interesting news on the bookstore and ereader front today.

B&N (Barnes & Noble) received an investment from Liberty Funding.  The amount comes to around $204 million (which of course is done through stock at a determined price, etc). 

Last year B&N put itself up for sale but didn’t sell… and perhaps in hindsight that’s a good thing.  Borders is now gone, the last remaining store will be closed by the end of summer.  Investors are hoping that Borders customers will make the switch to them.  Not sure how that will pan out – where I live, the closest big book store is a good forty minute drive… whereas a walk to my laptop is one set of steps (and my favorites menu has Amazon ready to go…).

B&N is really trying to put themselves in a spot to compete with Amazon and the other big guys out there.  In the article I read they listed some big names:  Amazon, Google, Apple.  While I respect B&N and I have heard great things about the Nook, I worry about a company that’s basing its survival on one product.  Now sure B&N has bookstores, I’m not discounting that at all, but in terms of the future – and where B&N wants themselves to be – they want to keep building their stake in the ebook market. 

Let’s look at those other companies for a minute… what’s the difference between those companies and B&N?

Those other companies have other products.  Complimentary products help sell main products, etc.  Amazon isn’t a bookstore – it’s an everything store (hence the A-Z concept).  Google is not just a bookstore or bookseller, look at their expansion plans.  And Apple, well, we all know what Apple sells.

So my thought is:  could B&N really make a living and a name for itself off its Nook?  What will the future Nook be?  Will they have a large line these ereaders?  Maybe incorporate a tablet into the mix too?

I can’t be sure.  I’m not saying the investment from Liberty Funding is bad – I think it’s great that B&N now has a little ground to walk.  They can exhale their breath and take a step away from the destruction that became Borders.  They can look to the future, and I really hope they succeed. 

But now, in the background of this deal, what does it say about ebooks?  Think about it… who in their right mind would give a bookstore $204 million?  Come on, be honest here.  Nobody would.  But when you toss in the figures for ebooks, ooohhh, does that sweeten the pot or what?  This is really amazing to watch right now.  Investors like Liberty stand a chance to really make a great return is B&N can step up their market share of ebooks.  And guess what?  That market in which all these big companies want to get more of is only going to grow and grow and grow.  We’re in a slow season right now as booksellers.  Head to KB and see how many people are worrying about their sales.  And from the historic data that long term authors are giving show that August is usually a rough month.  Summer – vacations – back to school.  And with the explosion of ebooks this past spring and Amazon picking up authors to their publishing company, could you imagine what this winter is going to be like?  Last year it was a big deal with authors were breaking 5,000 – 10,000 books sold in December… I have a feeling some authors are going to blow that figure out of the water this year.

With the extra tablets sales, Kindle sales, Nook sale, smart phone sales, Kindle Cloud Reader – and the general expansion of the knowledge of ebooks… this is going to be a wild season.

Personally, this will be my first October – April season of selling books.  I’ve been preparing new books, new book trailers, new ideas, new everything.  I’m ready to go. 

So tell me… what do you think of this investment from Liberty?  And what are your thoughts about this coming winter season for selling ebooks??

About Jim Bronyaur

Jim Bronyaur writes mystery, thriller, and horror books. Grab a book at www.JimBronyaur.com Tweet him @JimBronyaur And for those who have Kindles and Prime, you may be able to get some of Jim's books for FREE!
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5 Responses to B&N receives $204 million investment

  1. declanconner says:

    There are many things that B&N sell relating to books in their different divisions and not all are suffering. Take their College and University campus division and the sales of textbooks which is where they started … this division still performs. They also have a publishing division which was established prior to Amazons new venture. The only question mark is their bricks and morter stores. They could turn these stores to their advantage by changing direction if they so wished with this or future investment. Their stores are large and in prime positions. They could reduce front of house display in a similar fashion to Argos in the UK where shoppers could browse for stock on computer terminals, which could include a whole host of other products to include books from inventory in the back of house. They could add these products to their online presence and take some market share from Amazon.

    The could outflank Amazon by opening a catalogue overseas in advance of Amazon through aquisition. The Money men clearly see value and future growth that we as laymen and women can’t see. Don’t write them off just yet.

  2. Pingback: Follow up on B&N post… | Jim Bronyaur

  3. Haris Beg says:

    B&N’s struggle for survival is really a question about what kind of society we are becoming. In my opinion, B&N stores provide a huge service specially to kids. I go there almost every week with my child. I grab a cup of coffee from the next-door Starbucks and spend a good hour or two reading books to my child and browsing some books on my own. But do I buy books from there? No sir, why should I – when I can buy the same book much cheaper from Amazon?

    Sometimes I think about how things would look when there are no more brick and mortar book stores around? Maybe we will all use public libraries more frequently. I think of buying a Nook to show my support for B&N. But there are two reasons why I have not done so. One, I don’t want to buy a product if the seller may potentially go out of business anytime. Second, many of the e-Book titles on Nook are more expensive than the same at Amazon.

    If the same book costs the same at B&N and Amazon, I would definitely buy it from B&N. Free-market fundamentalists assert that the market always finds the best solution, but in the case of B&N versus Amazon, the free market has failed (as it has in so may other cases). In my opinion, the government should give a special subsidy to brick and mortar book stores to help them compete against free loaders like Amazon. Or maybe the government should just spend more money on public libraries.

    • Jim Bronyaur says:

      Haris – Thanks for the comment.

      I believe the Govt should invest in libraries. They are important for children to understand and read books.

      As far as Amazon vs B&N… customers choose who they want to buy from. You said it yourself that you’d prefer to buy from Amazon because they are cheaper. Amazon has found a way to do business online and found a way to manage their costs to provide the lowest prices possible. That’s like NetFlix vs BlockBuster. Same thing there.

      I really hope B&N survives – with stores too. I enjoy books stores. I personally only use my Kindle to support indie authors who can’t get into bookstores. But if I’m going to buy a book from Stephen King, etc. I make sure to head to a book store to buy it.


  4. Pingback: B&N… a gain with a loss | Jim Bronyaur, the blog

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