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Barnes and Noble has been experiencing a dramatic executive shuffle in the last few years.  Not only has the Nations largest bookseller replaced the CEO of the entire company, but the entire Nook division has seen every single key person leave. Today, B&N has announced that Mitchell Klipper, Chief Executive Officer of the Retail Group, will retire by May.  The Company said it has begun a search to fill Mr. Klipper’s position and that he will help with the selection of the new Retail CEO and in the transition process.

Klipper has been working for Barnes and Noble for over 28 years and previously acted as the company’s operating chief and chief financial officer. Before taking over as retail CEO, he oversaw the company’s development segment, which is responsible for its real estate operations.

Over the cost of his vast history with the company he picked new locations for bookstores, oversaw construction and design for more than 600 Barnes Noble’s superstores in the US.

Barnes and Noble reported during a recent earnings report that booksales will will be flat this year, which is better than the projected decline they made late last year.

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Chapters and Indigo have announced that the Vancouver flagship bookstore at Robson and Howe will be closing its doors on June 30th 2015.

The Chapters flagship retail location has fallen victim to a high rental increase for the  50,000 square feet of space over three levels of retail, including a dramatic entrance with soaring ceilings. The ground floor features a Starbucks shop-in-store, and a huge technology area. This is where Apple, Beats Audio, Kobo and a myriad of other gadgets are found. The second level features an 1,800 square foot licensed American Girl doll shop and a huge selection of non-fiction content. The store’s third level features a wide open spaces with thousands of square feet, this is primarily where the magazines, romance and YA fiction are housed.

In a statement, Indigo’s Chief Executive Officer, Heather Reisman said “As we gain great momentum with Indigo’s transformation strategy we are continuing to review all elements of our operations. With a very significant rent increase recently at our Chapters Robson store, the new terms are simply untenable for us to stay in that location. An increase of this magnitude would quite simply make this vibrant, profitable store unprofitable. As a result, we are actively pursuing another location to serve the Robson trade area which we fully intend to open in 2015. In other key markets we are also looking at new real estate opportunities for Indigo that will best serve our unique needs.”

It is highly unlikely that the closing of the Chapters flagship bookstore in downtown Vancouver will result in any big deals. Instead, the existing stock will be sent to existing bookstores in the Lower Mainland, such as Metrotown, Lougheed Mall, Surrey’s Strawberry Hill, Coquitlam’s Pinetree Village and Langley. All of the rest will be sent to the main Candian distribution center for processing.

The Granville and Broadway Chapters bookstore will benefit the most from the downtown location closing. It isn’t too far away and will see a dramatic increase in book buyers.

So what will happen to the prime piece of real estate when Chapters moves out? Business In Vancouver says it has received confirmation that FGL Sports is taking over the lease. This company operates Sport Chek and Atmosphere.

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Waterstones is in desperate need for an e-Book solution that they can market in all 300 of their retail stores in the United Kingdom. The bookseller has not been directly selling content, but making thin margins on every digital sale people make from the Kindles they buy from the shops. Salvation might be at hand, as Waterstones is in negations with Tesco about their Blinkbox Books platform.

In March 2014 supermarket chain Tesco unveiled their Blinkbox books platform that gave loyalty card holders an avenue to use their points to download bestselling e-Books. The platform turned into a full blown digital store, where content can be purchased and used on a myriad of e-readers and tablets. Last week, Tesco offloaded Blinkbox movies to TalkTalk, reportedly for between £25-30m, and Blinkbox Music has been sold to Australian music company Guvera for an undisclosed sum.

In a recent interview with Financial Times  CEO James Daunt said that Waterstones currently sells e-books in a “very inefficient and poor manner” and that with the rising popularity of tablets, Waterstones needs a platform for e-book sales that works on all devices.

I think Waterstones would be the best suitor for the Blinkbox Books platform, as the service is already tied to the loyalty card platform and integrating it with the booksellers service would be a walk in the park.  I know that Waterstones Amazon contract expires soon and Blinkbox would provide a homegrown e-book distribution solution that they can market in all of their stores and is more or less hardware agnostic.

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Supermarket chain Tesco has been one of the breakouts in the UK eBook arena the last few years with their Blinkbox Books platform. The company had perfectly leveraged their points cards, scanned during checkout, to give big discounts on popular digital titles. The future of this platform looks to be in doubt as Tesco has just sold off their Blinkbox Movies business and broadband solution to Talktalk. 

In a press release issued by TalkTalk they said “Blinkbox is one of the leading on-demand providers of pay content in the UK and works across multiple platforms and devices – both inside and outside the home.  blinkbox’s established technical expertise in multi-platform, multi-device content delivery and incremental content relationships are highly complementary to TalkTalk’s existing strategyof being the best value for money TV provider in the UK, offering customers flexible access to the widest range of free and paid for content.  TalkTalk TV is already the fastest growing TV platform in the UK with over 1.2 million customers and blinkbox will help accelerate the development of our platform by delivering a number of key initiatives significantly faster, such as offering a TV app to customers for in and out of home access to paid-for content across a range of devices.”

It looks like Talktalk had no interest in the Blinkbox books platform and there has been no word yet on whether or not Tesco will shutter this platform for good.

Normally digital bookstores hype their sales or issue press releases to inform the media on their performance. The grocery chain has never corresponded with any of the mainstream digital publishing websites and the only news they generated was last year when they were giving away 1,000 free copies of To Kill A Mockingbird. They normally just leverage in-store promotions in order to keep their shoppers informed. Right now they are running a promotion where if you buy a bestseller paperback in the store, you can get the digital edition for free.

The social media aspect of Blinkbox Books seems to be very active, with their Twitter account generating a ton of content every single day. Their online blog is updated semi regularly but the author events listings are woefully out of date.

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Barnes and Noble has just announced that their holiday sales for e-readers, tablets and e-Books did not meet expectations. Customers expressed trepidation about the booksellers new line of Samsung Galaxy Tab 4 Nook  devices and did not purchase them in droves like B&N had hoped.

The NOOK segment (including digital content, devices and accessories), had sales of $56 million for the nine-week holiday period, decreasing 55.4% as compared to a year ago.  Device and accessories sales were $28.5 million, a decrease of 67.9% from a year ago.  Digital content sales were $27.4 million, a decline of 25.0% compared to a year ago.

Print books once again were the savior of Barnes and Noble, even though digital did not live up to expectations. The Retail segment, which consists of the Barnes & Noble bookstores had sales of $1.1 billion, increasing 0.2% over the prior year.  Sales benefited from the continued stabilization of physical book sales and growth in the educational toys and games and gift departments.

I for one am very disappointed that Nook e-Books and e-reader sales continue to tank for the company. It is very hard to compete against the Kindle Voyage and Kobo H20 which sold in record numbers all December long. It also helped that many industry news and review websites gushed over these two devices and did not really hype any of B&N consumer electronics.

I would recommend if Barnes and Noble released a new e-reader in 2015 they should push it out at the end of October, in order to take advantage of all the positive press going into the holiday season. The last e-reader they issued, the Nook Glowlight came out at the beginning of 2014 and lost momentum towards the end of the year.


In late 2013 the FAA amended their policy to allow e-readers and tablets to be used gate to gate. It took almost a full year for the vast majority of airlines to officially adopt electronics usage but this year was the first major holiday season where travelers were able to read their e-books, digital magazines and newspapers in all phases of air travel.

Since the travel restrictions on e-readers, tablets and smartphones were lifted over 31 airlines have adopted the use of electronics and those companies account for 95% of all commercial traffic in the US.  Australia, Canada and most of Europe have also relaxed their restrictions on the usage of electronics on flights, but exact numbers on airline adoption rates are unknown.

Many airlines have rushed to offer e-Book, digital magazine and digital newspaper services in their lounges and computer terminals aboard the aircraft.  The intention behind most of these moves is to sell digital content to travelers and earn commissions on the sales.  Others give the content away for free as an added incentive to book your travel with them.

Jetblue partnered with HarperCollins to provide excerpts from a selection of bestselling eBooks, and each digital sample will include buy buttons to a variety of retailers. Excerpted titles include Flesh and Blood by Patricia Cornwell, Yes Please by Amy Poehler, Endgame: The Calling by James Frey and Nils Johnson-Shelton, and Pete the Cat and His Magic Sunglasses by James Dean. Purchased titles are synced automatically via WIFI to a users reader or tablet.

Newspaper and Magazine company PressReader offers their content in Virgin Australia lounges, which allows guests to access over 3,000 publications. They have also ironed out an agreement with flyDubai to have about a hundred papers available in the in-flight entertainment system to read in the air. Prior to takeoff guests can use their own devices to download thousands of issues for free and can read them whenever they want.

Although travelers have and airlines have been quick to embrace e-reading on air flights, the 60,000 person strong Association of Flight Attendants has filed a lawsuit against the FAA. In a legal filing they said that the FAA “acted improperly” and failed to follow proper protocol implementing the changes. A lawyer for the Association of Flight Attendants has argued that portable electronic devices distract passengers from safety announcements and can “become dangerous projectiles.”

Its doubtful whether or not the lawsuit has any merit, the three judges presiding over the case are not going to countermand the relaxed restrictions. In a recent statement by Judge Harry T. Edwards he said “Airlines have always had discretion on how to handle this.”

U.S. airlines carried 574.3 million system wide (domestic and international) scheduled service passengers during the first nine months of 2014. Exact statistics for the holiday season should be available within the next month. According to Twitter and Facebook social metrics, many travelers were very happy with being able to use their electronics gate to gate this year. Listening to music while taking off and landing remained one of the most popular ways travelers alleviated the stress of flying.

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Waterstones is the largest bookstore chain the United Kingdom and they have proclaimed that Kindle sales had “disappeared to all intents and purposes.”

James Daunt is the CEO of Waterstones and many people in the bookselling industry were surprised when he forged a relationship with Amazon in 2012 to sell Kindle e-reader. A year prior, in a series of interviews, Daunt spoke of Amazon as the “enemy” and “a ruthless, money-making devil”.

Daunt lamented that his predecessors did not develop their own e-reader while the market was unsaturated and not consolidated. Waterstones sold lackluster devices that did not allow customers to buy books right on the readers. When James took over the company his first reaction was to scrap all the woeful readers they currently stocked and made new relationships with Amazon to bring in a big brand name.

One of the reasons why Waterstones is seeing a decline in e-reader sales is because British consumers are still enamored with print. Over £2.2 billion was spent on hardcovers and paperbacks in 2013, compared to the £300 million that was generated by e-books. James Daunt told the Financial Times that the resurgence in popularity of tangible books was due to Waterstones refurbishing some of its 290 shops.

I think this was an interesting time for Waterstones to proclaim that Kindle sales were dead. The five year contract to sell the readers and tablets expires this year and this could be used as leverage to get a better deal or to get out of dealing with Amazon completely. The die hard Kindle users tend to buy the devices online from Amazon when pre-orders become available for new product releases, such as the Kindle Voyage.

If Waterstones were to get out of the Kindle contract, likely they would secure a number of deals with other e-reader companies such as Barnes and Noble, Kobo and the Tolino Alliance.

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Amazon had a banner year in 2014 with over two billion items shipped worldwide by 3rd party sellers. This is a staggering number, considering there are only two million registered vendors who use the service.

3rd party sellers accounted for over 40% of all items sold on Amazon over 2014. Products such as books, movies and trading cards were shipped from 100 different countries around the world fulfilled orders to customers in 185 countries.

The e-tailer proclaimed that the largest growth was primarily due to China and Hong Kong-based sellers whose international sales grew 80% year-over-year.

One of the ways sellers have been able to crank up the volume orders on Amazon is due to the Amazon Seller App. It is available for Android, iOS and Fire phone, and makes it easier for sellers on Amazon to quickly manage inventory, source and list new items, and quickly respond to customer inquiries.

It’s been a record-setting year for selling on Amazon. We’re seeing strong growth from sellers listing their items across our global marketplaces. In fact, there are now more than a billion offers for customers to browse from sellers who are listing items for sale outside their home country,” said Peter Faricy, VP for Amazon Marketplace. “The growth of mobile and the introduction of the Amazon Seller App have also been a big win for sellers this year. Sellers are constantly telling us they value the flexibility of managing their businesses on-the-go from their tablets and mobile devices.”

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stock exchange investment

When Barnes and Noble started experiencing close to $1.2 billion in loses in their Nook Media division, they started to get companies to invest. Microsoft contributed $300 million and educational publisher Pearson kicked in $89 million. In early December the bookseller bought back their shares from Microsoft and today, B&N repurchased the 5% equity investment from Pearson for $28 million dollars in cash and stock.

Barnes and Noble is now free to charter their own path, without having to be accountable to 3rd party investors. Although they are still responsible to their shareholders, as part of being a publicly traded company, they are free to determine their own direction.

Earlier in the year, the largest bookseller in the US expressed their interest about spinning off the Nook division into its own autonomous entity. This is poised to occur in August 2015 and should increase the overall profitability of the consumer and college bookstores, which tend to be huge money earners.  It is yet unknown whether or not anyone will step forward and purchase Nook, or if Barnes and Noble will commit themselves to e-Books and e-readers for the foreseeable future.

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Children are reading in record numbers in the last decade, which has propelled billion dollar properties such as Harry Potter, Percy Jackson, Twilight, Hunger Games, Diary of a Wimpy Kid. Not only have these titles done staggering well but it has promoted the success of books with similar subjects and themes and are benefiting from each other’s successes.  Over the course of the last two years John Green and Veronica Roth are the highest-selling authors; juvenile fiction is performing so amazingly that 17 of the 20 overall bestsellers in the US during 2014 were books for children.

Nielsen hosted the first annual Children’s Book Summit in Manhattan and produced research for over a four year period.  They produced research that the children’s book market has increased 44% in the last decade and 67% of teens read for pleasure. Ironically, although tablet adoption has increased exponentially, 50% still prefer print books over eBooks.

Kristen McLean, founder and CEO of Bookigee provided some interesting information on where books are being purchased.  62% of the purchases are taking place at physical bookstores, such as Barnes and Noble.  Juvenile represents 35% of the total physical market over the last 12 months with juvenile fiction largely driving the sales from 2011 to 2014, resulting in “a great variety of publishers seeing positive growth.” Games and activity books as well as crossover products, representing “blockbuster brands bleeding over to nonfiction,” such as Minecraft and Lego, are also raising “very interesting implications.” MacLean suggested that this trend “leads to the rise of lifestyle books in juvenile nonfiction, and popularity of shows like MasterChef Junior.” One surprising find from a study about demographic buying habits showed that 42% of people who purchase children’s nonfiction titles actually have no children: 15% of these buyers purchased the books as gifts, and 27% of them reported buying the books for themselves.

The success of children’s and juvenile fiction has helped Scholastic continue to generate solid revenue. The company reported second quarter 2015 earnings were $665.6 million, compared to $623.2 million a year ago, an increase of 7%. Scholastic affirmed its fiscal 2015 outlook will account for approximately $1.9 billion.

The most exciting trend that this conference produce was there is a strong misconception that youth and young adults spend the majority of their time online, visiting sites such as Facebook and Twitter and not reading. What Nielson found is that they are establishing strong bonds with their friends, which leads to book recommendations being taken very seriously. This has led to a population explosion with Goodreads. Recently, the website reported a record 3.3 million votes cast in the 6th annual Goodreads Choice Award.


The head position at Amazon publishing, is not exactly cursed, but people tend not to last very long. A year into the job, Daphne Durham is leaving the company.

Daphne took over the reigns of the publishing division from Larry Kirshbaum, who had been with Amazon since 2011 and left at the beginning of 2013. Initially Larry served as the vice president and publisher of Amazon Publishing’s New York office and later as editorial director for imprints on both the east and west coasts. He was famous for bringing in big names such as actress and director Penny Marshall and best-selling writer Timothy Ferriss.

Daphne on the other hand had been with Amazon for over 15 years, prior to taking over Amazon Publishing. Instead of focusing on big names, Durham set her eyes on niche markets, such as mysteries, science fiction and religious titles. One of the most interesting things that was accomplished under her watch was looking at the big data of the Kindle e-Book business to find unsigned authors and push into untapped markets such as fan fiction.

In the past, Amazon has always had one person in charge of the publishing division. This obviously has not worked out very well, because the job has been, well cursed. In order to create more fluidity, Amazon is going to be spreading the duties out to two different people, one based in Seattle and one in the critical New York market.

Mikyla Bruder, who is based in Seattle, currently runs global marketing for Amazon Publishing. She will become publisher for Amazon’s Montlake Romance, Thomas & Mercer, Skyscape, Lake Union, 47North and Jet City Comics imprints.

David Blum is based in New York and is best known for being the editor of Kindle Singles. He will take over control of  Amazon’s Little A and Two Lions imprints. His mandate is to expand Amazon’s nonfiction publishing under Little A.


Microsoft has announced their first quarterly earnings report for 2015 and
the Surface 3 tablet is seeing massive success. Surface revenues measured $908 million, which is transforming their hardware division into almost a billion dollar business every three months. The company is also building revenue from phone hardware, taking in $2.6 billion from quarterly handset sales through what was once Nokia’s hardware business. Microsoft reported $478 million in gross margin from phone hardware as it continues its effort to build market share for Windows Phones.

Microsoft is betting big on the new Windows 10 OS, which is now in technical preview. This  might be a game changer because the Redmond company is adopting the “One Windows” strategy, which will unite phones, tablets, and PCs under a single operating system. Today, the Windows market is fragmented between Windows Phone, Windows RT, and Windows 8 — three separate systems which aren’t fully compatible with each other. With Windows 10, the number-skipping upgrade which will arrive sometime next year, Microsoft will eliminate those incompatibilities with a single cross-platform OS.

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In 2002 PayPal became a wholly owned subsidiary of eBay and has been used to facilitate payments on the e-commence site. Due to the increasing pressures of the modern economic reality with Apple Pay, Alipay and Square, eBay and Paypal have agreed to part ways and Paypal will now be its own publicly traded company in 2015.

Devin Wenig, president of eBay Marketplaces, to become CEO of new eBay company following separation and American Express executive Dan Schulman joins PayPal immediately as President and CEO designee for PayPal post-separation.

PayPal has been on pace to overtake eBay’s core marketplace by sales. In the June quarter, the payments unit boosted sales 20% to $1.95 billion and added 4.1 million new active customers from the first quarter, to 152.5 million. PayPal facilitates one in every six dollars spent online, eBay said. At its namesake marketplace, revenue rose 9% to $2.17 billion as the number of active accounts increased by 3.8 million to 148.9 million.

“The payments landscape is hyper-competitive, the pace of change is accelerating and everyone is gunning for PayPal,” said Forrester analyst Denee Carrington. “The split will give PayPal greater agility to help it achieve its full potential.”

PayPal has been expanding beyond online and mobile payments and offering other financial services. It began lending money to small business customers late last year. And eBay bought Braintree, a payment processor used by startups such as vacation rentals site Airbnb and cab-hailing app Uber, a year ago for about $800 million and will be part of the PayPal unit.

Hopefully that now Paypal will be an autonomous entity they could really redeem themselves in the eyes of internet users. We have all heard of the horror stories of Paypal being used to facilitate Kickstarter payments, only to have the money put on hold and the developers have to jump through months of hoops to get any of it back, if they do get any of it back.

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