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Since 1971, when a young New York University dropout and textbook dealer named Leonard Riggio bought a venerable but sleepy college textbook store named Barnes & Noble, the company has often been at the cutting edge of bookselling: The first to offer discounts on best sellers in the US. The first to build a national brand out of what had been a local business. The first to sell books in a big box venue that offered more selection and lower prices than the competition. And the first bookstore chain in the US to think not only about price but also about ambiance, recognizing the advantages of promoting book-browsing as a leisure activity.
But after decades of remarkable growth, during which its 720 green-fronted superstores and 637 college bookstores have become a familiar part of the American landscape, Barnes & Noble faces two formidable challenges. First, more and more people are buying their books online, more often from Amazon than Barnes & Noble, and second, e-book reading devices such as Amazon’s Kindle and Apple’s iPad are taking millions of customers out of the market for physical books altogether.
“The store model is under pressure, whichever way you look at it,” the 69-year-old chairman of the New York company told reporters recently.
The most immediate danger is Amazon. The Internet giant claims to be “Earth’s biggest bookstore,” and not just in terms of volumes for sale but volumes sold. According to book sales statistics collected by Foner Books, more books are sold now on Amazon both in the US and abroad than by any other single outlet anywhere.
Foner Books’ statistics on the North American book market note that in 2009, Amazon’s media sales (including books, music, and DVDs) totaled $5.96 billion. By comparison, the big green machine sold $4.3 billion, plus $573 million online through BN.com. Nor does the balance seem to be stabilizing. In media sales alone, Amazon’s North American sales have risen by an average of nearly 15 percent per year over the last 9 years, compared to about 3.12 percent for Barnes & Noble and 4.75 percent for BN.com (at least as of 2008). Internationally too, where Barnes & Noble is not active—and in fact doesn’t even sell e-books—Amazon media sales are growing even faster. In 2009 Amazon’s international media sales reached $6.81 billion.
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