Don’t blame ebooks for Borders’ demise
July 21, 2011 | 11:45 am
While some of the more cursory summaries in the press are framing Borders as a victim of the ebook revolution, anyone who’s followed the story knows that the company was being publicly embarrassed by its financial woes not five months after the first Kindle was released–hardly enough time for Amazon to strike an ebook death blow.
Edward Nawotka in Publishing Perspectives traces the problems back all the way to 2001, when a lethal dose of grocery store DNA was injected into Borders’ upper management tier–who then handed the company’s online sales over to Amazon. Add to that some labor problems and a financial crisis, and you had a company in fragile health well before ebook sales started to take off.
Mike Shatzkin at Idealog agrees, and thinks that Borders’ biggest mistake was handing over its online business to Amazon in 2001:
Turning over ecommerce to Amazon showed a shocking lack of digital vision. It is often forgotten that Barnes & Noble once made half the same mistake: they originally owned their BN.com ecommerce capability jointly with Bertelsmann until they bought their partner out. And Barnes & Noble had obvious challenges reconciling their online business with their overall business until they brought in new management that clearly saw the online business as the future. That wasn’t until much later in the century’s first decade. The problem both chains probably saw is that the skill sets required to run a successful brick store chain didn’t apply to creating a digital business so they were nervous about investing too heavily in it. When the time came that it was obvious that they had to do so, Borders was too weak to recover and Barnes & Noble, despite a web operation that had serious flaws, at least had a platform and customer base to build on.
There’s another good laundry list of mistakes in Slate’s Moneybox column by Annie Lowrey.
All of these hindsight analyses were also made back when Borders first declared bankruptcy earlier this year, but I think it’s worth bringing them up again this week when it’s so easy to mistakenly cast ebooks as the beast that slew Borders.