Acting on a Twitter tip from my friend Nick Gillespie last week, I read with interest Ted Gioia’s Dec. 28th Substack “finally some good publishing news” column about the “turnaround” at Barnes & Noble, the country’s largest bookseller, which plans to open 30 new stores in 2023, after adding 16 last year. Gioia isn’t some novice hired to write puff pieces: the 65-year-old is the author of 11 books, a noted music historian and musician and someone with knowledge of the business world, as he’s consulted for the Boston Consulting Group and McKinsey & Company.
He begins: “I’ve written too many negative stories about digital media platforms in recent months. I’ve started to worry. Am I turning into Dr. Doom and Mr. Gloom? In all fairness, my predictions have proven sadly accurate. After I served up these dismal forecasts for Facebook, Spotify, Netflix, and others, their share prices took a steep dive.”
And then he begins a love letter to Barnes & Noble, and its current Chief Executive James Daunt—credited for turning around bookstore chain Waterstones in Britain—touting the company’s (established in 1886) new approach to retailing, which purportedly caters to consumers who love books, while thumbing its nose at publisher’s discount entreaties and gimmicks to force-feed titles that’ve received large advances, meaning, I’d guess, ghost-written titles by celebrities and politicians. I don’t at all begrudge Gioia’s enthusiasm—he’s an author, undoubtedly an avid reader and the holder of degrees from Stanford (2) and Oxford, and desperately wants a return to a popular culture where people discussed ideas at cafes and stores that weren’t sullied by social media madness—but I don’t think it’s accurate.
Nine days earlier, The Wall Street Journal ran a business story about B&N’s uptick in profitability, as well as other “big-box retailers” that have emerged from the Covid lockdowns and seen their fortunes improve. The Journal’s Kate King, whose article was bullish, but nowhere near as ebullient as Gioia’s, wrote that B&N is “booming,” and notes that B&N’s number of stores peaked in 2008 at 726 and now has “around 600.” (When I lived in Manhattan I could’ve sworn there were 800 B&N outlets in the city alone.)
Gioia isn’t wrong that the tech companies he cites—Netflix, Facebook, Spotify and so many others—have taken a beating in the past year, due to both a market overvaluation and in some cases, bad decisions that’ve rattled both investors and consumers, such as Mark Zuckerberg’s incoherence about his plans for Meta Platforms (Facebook, Instagram, etc.) and Netflix’s back-and-forth on including advertisements with its programming and increased criticism of the content it offers. (Tangentially, I once tuned into Netflix more often, but no more: aside from Peaky Blinders and Ozark, I’ve watched little there, compared to Amazon Prime.)
In all likelihood, the share prices of those companies will rise—if not to the stratospheric levels of recent years—once the economic downturn has reversed and investors are in a buy mode again. One more reality nugget: Barnes & Noble was sold in 2019 to hedge fund Elliott Management for $683 million (it bought Waterstones the year before, hence the Daunt connection), a fraction of what tech companies fetch when selling. It reminds me of when Amazon’s Jeff Bezos bought the struggling Washington Post for a paltry $250 million in 2013, a number that just 15 years earlier, pre-Internet, would’ve been five times higher, if The New York Times Co.’s short-sighted purchase of The Boston Globe for $1.l billion in 1993 is a reliable indication. (In 2013, the Times Co. sold the Globe to Boston Red Sox principal owner John Henry for $70 million.) In comparison—and this is entirely hypothetical—if someone tomorrow put forth a preemptive bid for Netflix, the price would be north of $125 billion, the company’s troubles notwithstanding.
Like most people who read a lot I’d welcome a return of physical bookstores, both independent and chain, that resemble what I, and others, once took for granted. However, a major factor that Gioia, whether unintentionally or not, doesn’t mention is that demographics aren’t favorable for book purveyors. Just like newspapers—nostalgia photos are common of, say, a 1968 subway train in New York where almost every person is reading a newspaper—the person who reads and buys many books is older, generally over 45, and as I’ve said, with no pleasure, for years now, every day people who read die and won’t be replaced in consumption habits by those who are born. Boomers and Gen-Xers can sneer all they want at Millennials and Zoomers for playing videogames and not looking up from their phones, but that’s just a denial of a popular culture shift. Reading books or newspapers is an older person’s habit; today’s youth, for better or worse—and who can tell about that?—have other recreational interests.
Maybe I’m wrong, but the guess here is that books, despite James Gaunt’s innovations, will become a niche industry, much like the (limited) return of vinyl records starting in the 1990s. Companies can cite year-to-year sales increases, but something beats nothing, and there will never be a return to robust vinyl and CDs sales of the 1970s and 80s. Also, face reality: when Thomas Mallon’s Up With the Sun is released on Feb. 7th, I’ll buy it from Amazon rather than visit one A bookstore in Baltimore. I’m a sport and have looked up titles at Portland-based Powell’s Books online (I receive an email daily from Powell’s, which I don’t mind, since it recommends books that I might get—on Amazon) and once ordered a novel. It took three weeks to arrive. No thanks.
Near the end of Gioia’s column, he writes: “I could draw many other lessons from the Barnes & Noble turnaround. I praise its decentralization, and its willingness to empower booksellers at the local stores. I like the way the stores look nowadays, and the improved selection on the shelves. But the key element uniting all of this is putting books and readers first, and everything else second.”
When I do go to bookstores in Baltimore (Atomic Books is great) and other cities, I’ve noticed that since the 1990s the staff is much more friendly—The Strand in NYC a prime example—which is welcome, but it’s too little, too late. At one time, not untypically for readers, I went to bookstores at least twice a week, either from a work break or with my kids on weekends, and it was a great pleasure. I also subscribed to scores of magazines and spent a lot of time at Tower Records. I loved it all yesterday, but as Chad & Jeremy sang, yesterday’s gone.
—Follow Russ Smith on Twitter: @MUGGER1955