Longtime readers of The Hot Sheet know that we regularly look at the latest performance stats and news coming out of the biggest US bookstore chain, Barnes & Noble. (Our most recent item covered the tribulations of its educational arm.)
And as longtime followers of Publishers Lunch know, Michael Cader has been commenting on B&N’s dwindling Nook e-reading device and ebook retail business since at least 2014. Speaking of the fiscal year that ended in summer 2017, he stated (paywall), “The one improvement is that as Nook fades to a rounding error, they only expect to lose $20 million.” In acknowledgment of Nook’s failure to compete against Amazon’s Kindle or even Apple’s iBooks, Barnes & Noble’s chairman, Len Riggio, told investors last month, “There is no business model in technology” for the chain. That immediately led to speculation that the business would be sold off—but to whom? And might Barnes & Noble partner with an ebook retailer if Nook is sold?
Kobo has an established track record of taking over the customers of terminated ebook retail operations (such as the UK’s Waterstones and Sainsbury’s and South Africa’s Exclusive Books), and it has been a partner of various retail operations (such as Tolino, which originates in Germany, and independent bookstores in the United States). It’s also worth noting that Rakuten, Kobo’s Japanese parent company, shows Kobo up 82.7 percent in the second quarter year over year, including Tolino revenue. First-quarter gains were listed at 21.8 percent year over year. Kobo seems flush and agile at the moment.
Then again, as Mark Williams suggests, an overseas player—a Chinese one in particular—might be interested in purchasing the Nook business to gain entry to the US market.
Bottom line: Barnes & Noble has lost about $1.3 billion on the Nook business in the last six years, according to Fortune. At its peak, Nook enjoyed sales of nearly $1 billion a year. Currently it has sales of about $150 million a year. Many people inside and outside of the industry think it’s time to pull the plug.
Jane Friedman has spent her entire career working in the publishing industry, with a focus on business reporting and author education. Established in 2015, her newsletter The Bottom Line provides nuanced market intelligence to thousands of authors and industry professionals; in 2023, she was named Publishing Commentator of the Year by Digital Book World.
Jane’s expertise regularly features in major media outlets such as The New York Times, The Atlantic, NPR, The Today Show, Wired, The Guardian, Fox News, and BBC. Her book, The Business of Being a Writer, Second Edition (The University of Chicago Press), is used as a classroom text by many writing and publishing degree programs. She reaches thousands through speaking engagements and workshops at diverse venues worldwide, including NYU’s Advanced Publishing Institute, Frankfurt Book Fair, and numerous MFA programs.
