News

Daunt: Waterstones customers 'want Kindle'

Waterstones m.d. James Daunt has said the deal with Amazon to sell its e-reading devices and Kindle e-books through Waterstones' shops was a "no brainer", admitting that Amazon sold the e-reader that Waterstones' customers wanted to use, and that Waterstones had left it too late to develop its own device.

"We asked ourselves, 'what do our customers want?'; the answer was the Kindle. Once we'd done that this was self-evidently the best deal." Daunt said the two businesses had started talking only "relatively recently", admitting that he had looked at other options but rejected them. "Ultimately, when we thought about it, we had to give the customers what they wanted. And the best device on the market is the Kindle."

Daunt refused to reveal the terms of the deal, but said the chain would "get a cut" when a customer bought an e-book off the Kindle device when using the Wi-Fi in Waterstones' shops. Waterstones will roll out Wi-Fi in its stores, with the plan to bring in the first devices by the autumn.

Daunt declined to say if Amazon was putting money up-front as part of the deal, but said the arrangement would "facilitate' the investment in IT within stores, the roll-out of coffee shops, and staff training. Daunt said: "The future of Waterstones is in its physical stores, selling physical books, but doing other things around it, such as coffee and digital readers. This is much more about making Waterstones’ a better physical business, enticing those Kindle customers back into bookshops, and improving the Kindle browsing  experience for them. In terms of what we can offer, we’ll only be limited by our imagination.”

Customers would buy the e-books from Amazon direct, but from within the Waterstones' environment, Daunt said. Publishers will continue to deal with Amazon and Waterstones separately.

Daunt said the deal with Amazon was "non-exclusive", and that Waterstones would continue to operate its own e-book platform separate to any Kindle online presence, but said the company would look at adding a link from the Waterstones.com site to the Kindle store. Daunt said he remained "committed" to the Waterstones.com e-book business, and would continue to work with publishers to develop it.

Daunt said the business had left it "too late" to invest in its own device saying it was "something my predecessors would have had to do", and admitted it did not have the resources to go it alone. "We might have got a product out by next Christmas, not this Christmas, and that would have been too late. We'd have been out of this market, and that just wasn't acceptable."

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Long overdue, the vision for this bookseller model was forecast years ago, as portrayed by the French Publisher Editis, in this early video http://www.youtube.com/watch?v=huV6kLrwiT8

But they had a deal with Sony for the Sony Reader! Which is better.
and isn't linked to Amazon, y'know, the company that's destroying High Street Booksellers....

In my view it is not a question of which device that shops will carry. The true error in my judgement is Waterstones not coming up with their own device and strategy to compete in the ebook and other IP space with their own ereader. The Nook is a good example. Where would B&N be today if they had not introduced the Nook and simply decided to sell e-reading devices from others in the shops? I view this type of approach as simply kicking the can down the road until Waterstones hits the wall.

Robert Gottlieb
Chairman
Trident Media Group, LLC
www.tridentmediagroup.com

Dear Robert,

I believe JD has addressed your point in the last paragraph of the article. In summary: it was left too late and the company does not have enough money. We can all beat our chests about the ineptitude of mistakes made in the past or we can keep moving forward.

Yes, it may seem controversial working with a competitor but it's far better than coming out with a half cocked cheap copy released too late. It's a concessionary "book product" in a book specialist retailers. Not really that much of a leap is it?

The battle may be competing with online retailers but the war is keeping people reading and browsing. And reading.

Stand near the desk in any bookshop and count how many people ask each day if they sell kindles. Wouldn't it be nice to give the customer what they want? Have you ever seen someone in a shop buy an ereader and not pick up a children's or cookery book while they're there?

Cheer up everyone, it might even work.

Bookseller, it wasn't left too late. JD inherited a business that had an active partnership with Sony and chose to throw them out. We immediately missed the sales in our store. That was his decision, nothing to do with his predecessors.

Actually we didn't - if you remember, the PRS-650 was limited to the 'top 20' stores and the PRS-350 was ridiculously hard to get hold of because of 'supply issues'. We may have sold Sony's on paper, but by the time we stopped the partnership, there were none left to sell because Sony couldn't supply. We also had the 'other readers' which weren't awful, they were just 'meh', so while I disagreed with Daunt's decision to stop selling eReaders before Christmas, ultimately it was the right thing to do.

To replace it with the Kindle though... this decision remains to be seen as a good one, but Daunt hasn't made any truly terrible decisions yet - we can perhaps hope this falls under that category.

Hi Leko, It was too late for Waterstones to develop it's own is the point JD makes (refreshingly honest.)

I think Robert was using the B&N Nook as an example (Which btw I agree with, it would have been the ideal scenario for W to have developed their own.) B&N started developing the Nook years ago and have just had a cash injection of £300 million. W missed the boat.

The service offer on the Sony was appalling and the supply line even worse. It was untenable for W to continue with that and maintain (or claw back) a reputation as a decent bookseller. However good the product was, the overall offer was poor.

I don't believe it is too late or to expensive to be in the hardware ebook device business. There are a myriad of ways to co-develop and offset costs. There are potential partners over the globe who one could work with from India to China. It is about imagination and innovation in ebook and device space in today's publishing industry.

Just one example would have been to create an alliance with B&N with the Nook for the British market. Develop a new business model for the two firms to share. A device specially designed for the British book buyer and the Commonwealth could have huge value. The British have a substantial potential market around the world in the English language to offset costs and is already there is a mature distribution system in place.

The Nook is now a brand. Waterstones needs to think about how they want to brand themselves in the market place and at the same time generate assets. The Nook as many know is a big asset as is the Kindle in the U.S..

One could seek partnerships with publishers and government to off set costs as well.

Just a range of ideas that come to mind now.

Robert Gottlieb
Chairman
Trident Media Group, LLC
www.tridentmediagroup.com

Hi Robert,

Really? Enough money and enough time? You did see the size of the investment Microsoft has just made in B&N? You must have seen how much W was sold for last year?

We're 30 weeks away from Christmas week.

This should have been in the works for at least 20 months. At the very least. It wasn't and that was a mistake. Whether or not it was an avoidable one considering W was under HMVs financial umbrealla is a moot point, the mistake has been made. To start a process that lengthy now to aim for next Christmas would be farcical in this climate.

It's clearly not ideal not to have their own branded item but to stay in the game they need to have A branded ereader and why not the biggest brand of them all?

When Waterstone's first developed a website in was in conjunction with Amazon which confused customers and it has to be said they were too late developing their own. Amazon and the Kindle are now synonymous with e-reading so will anyone bother to use the Waterstone's website at all either for e-books or indeed physical books?

'Daunt declined to say if Amazon was putting money up-front as part of the deal, but said the arrangement would "facilitate' the investment in IT within stores, the roll-out of coffee shops, and staff training.' Will there now be an area of Waterstone's shops emblazoned with the Amazon logo? 'Publishers will continue to deal with Amazon and Waterstones separately' and as Amazon have the better negotiating power they will strike the better deals.

It seems a very bizarre alliance and one tipped very much in Amazon's favour.

It has been said that Kindle is to e-readers what Hoover was to vacuum cleaners. So what if one of the big electronics brands wants a chance to be the next Dyson?

If a big player develops a device that can compete with Kindle hardware. W merchandises it alongside the Kindle with a bonus that it will be bundled with QUALITY books chosen by W Booksellers... or any number of other book orientated incentives...

Just a thought.

But that's already happening. Now that Microsoft has bought into the Nook, which presumably is the reason for this desperate move by Waterstones, the perfect Big Boy/technology development scenario is happening. Unfortunately for us it's only happening in the US. Will they have an integrated Nook app in Windows 8, the tablet OS? We'll see.

I don't believe it is too late or to expensive to be in the hardware ebook device business. There are a myriad of ways to co-develop and offset costs. There are potential partners over the globe who one could work with. It is about, imagination, imitative and innovation in business today.

Just one example would have been to create an alliance with B&N with the Nook for the British market. Develop a new business model for the two firms to share. A device specially designed for the British book buyer and the Commonwealth could have huge value. The British have a substantial potential market around the world in the English language to offset costs and is already there is a mature distribution system in place.

The Nook is now a brand. Waterstones needs to think about how they want to brand themselves in the market place and at the same time generate assets. The Nook as many know is a big asset as is the Kindle in the U.S.

One could seek partnerships with publishers and government to off set costs as well.

Just a range of ideas that come to mind now.

Robert Gottlieb
Chairman
Trident Media Group, LLC
www.tridentmediagroup.com

Hi Robert,

Really? Enough money and enough time? You did see the size of the investment Microsoft has just made in B&N? You must have seen how much W was sold for last year?

We're 30 weeks away from Christmas week.

This should have been in the works for at least 20 months. At the very least. It wasn't and that was a mistake. Whether or not it was an avoidable one considering W was under HMVs financial umbrealla is a moot point, the mistake has been made. To start a process that lengthy now to aim for next Christmas would be farcical in this climate.

It's clearly not ideal not to have their own branded item but to stay in the game they need to have A branded ereader and why not the biggest brand of them all?

Does this mean then that Waterstone's as well as giving up on developing a device themselves have also given up on selling e-books on their own website? Whatever amount Waterstones get when someone purchases from Amazon must be a price Amazon are willing to pay but to what end? As Daunt himself said they are 'a ruthless money making devil' so are they just playing the long game and waiting for Waterstone's to commit a long, slow and painful hari kari? As someone else said if Waterstone's can find tens of millions to improve their stores could they have not used that to develop their own device or go into partnership with a company and shown some corporate responsibility by allowing it to be compatible with library catalogues? Are not most of their coffee shops concessions anyway with those chains putting their money in? Most of Piccadilly is concessions now and I am not sure if its claim to be be Europes biggest bookshop in terms of books is still true.

Is this Mamut's price for funding the Waterstone's investment and re-fit? Did Mr Daunt have a choice? Oligarchs ride again?

It makes an investigation into the monopolistic levaiathan named Amazon even more urgent.

Yes "really" Bookseller.

Presumably those booksellers who had the temerity to suggest that the Kindle was a better device than the Sony Reader when Waterstone's stocked that exclusively will have the black mark against their names removed?

You're correct Meerkat,I've often been asked for Kindles by customers,meaning e-readers,in the same way Hoover is used for vacuum cleaners and Coke for colas (no-one asks for a Pepsi that way do they?)I'm on holiday at the mo' so it was a surprise (The Nook I thought,too) and I even phoned into work to make sure it was so.Being a dedicated bookseller(for over 20 years)I certainly don't want physical bookselling to die and still love what I do.Booksellers are often underestimated in their role;true,some are only part-time or in the trade short term,but many of us realise that we have to fight for our trade and will meet the challenge head-on.I just hope James has a grand gameplan...

Long overdue, the vision for this bookseller model was forecast years ago, as portrayed by the French Publisher Editis, in this early video http://www.youtube.com/watch?v=huV6kLrwiT8

But they had a deal with Sony for the Sony Reader! Which is better.
and isn't linked to Amazon, y'know, the company that's destroying High Street Booksellers....

In my view it is not a question of which device that shops will carry. The true error in my judgement is Waterstones not coming up with their own device and strategy to compete in the ebook and other IP space with their own ereader. The Nook is a good example. Where would B&N be today if they had not introduced the Nook and simply decided to sell e-reading devices from others in the shops? I view this type of approach as simply kicking the can down the road until Waterstones hits the wall.

Robert Gottlieb
Chairman
Trident Media Group, LLC
www.tridentmediagroup.com

Dear Robert,

I believe JD has addressed your point in the last paragraph of the article. In summary: it was left too late and the company does not have enough money. We can all beat our chests about the ineptitude of mistakes made in the past or we can keep moving forward.

Yes, it may seem controversial working with a competitor but it's far better than coming out with a half cocked cheap copy released too late. It's a concessionary "book product" in a book specialist retailers. Not really that much of a leap is it?

The battle may be competing with online retailers but the war is keeping people reading and browsing. And reading.

Stand near the desk in any bookshop and count how many people ask each day if they sell kindles. Wouldn't it be nice to give the customer what they want? Have you ever seen someone in a shop buy an ereader and not pick up a children's or cookery book while they're there?

Cheer up everyone, it might even work.

Bookseller, it wasn't left too late. JD inherited a business that had an active partnership with Sony and chose to throw them out. We immediately missed the sales in our store. That was his decision, nothing to do with his predecessors.

Actually we didn't - if you remember, the PRS-650 was limited to the 'top 20' stores and the PRS-350 was ridiculously hard to get hold of because of 'supply issues'. We may have sold Sony's on paper, but by the time we stopped the partnership, there were none left to sell because Sony couldn't supply. We also had the 'other readers' which weren't awful, they were just 'meh', so while I disagreed with Daunt's decision to stop selling eReaders before Christmas, ultimately it was the right thing to do.

To replace it with the Kindle though... this decision remains to be seen as a good one, but Daunt hasn't made any truly terrible decisions yet - we can perhaps hope this falls under that category.

Hi Leko, It was too late for Waterstones to develop it's own is the point JD makes (refreshingly honest.)

I think Robert was using the B&N Nook as an example (Which btw I agree with, it would have been the ideal scenario for W to have developed their own.) B&N started developing the Nook years ago and have just had a cash injection of £300 million. W missed the boat.

The service offer on the Sony was appalling and the supply line even worse. It was untenable for W to continue with that and maintain (or claw back) a reputation as a decent bookseller. However good the product was, the overall offer was poor.

I don't believe it is too late or to expensive to be in the hardware ebook device business. There are a myriad of ways to co-develop and offset costs. There are potential partners over the globe who one could work with from India to China. It is about imagination and innovation in ebook and device space in today's publishing industry.

Just one example would have been to create an alliance with B&N with the Nook for the British market. Develop a new business model for the two firms to share. A device specially designed for the British book buyer and the Commonwealth could have huge value. The British have a substantial potential market around the world in the English language to offset costs and is already there is a mature distribution system in place.

The Nook is now a brand. Waterstones needs to think about how they want to brand themselves in the market place and at the same time generate assets. The Nook as many know is a big asset as is the Kindle in the U.S..

One could seek partnerships with publishers and government to off set costs as well.

Just a range of ideas that come to mind now.

Robert Gottlieb
Chairman
Trident Media Group, LLC
www.tridentmediagroup.com

Hi Robert,

Really? Enough money and enough time? You did see the size of the investment Microsoft has just made in B&N? You must have seen how much W was sold for last year?

We're 30 weeks away from Christmas week.

This should have been in the works for at least 20 months. At the very least. It wasn't and that was a mistake. Whether or not it was an avoidable one considering W was under HMVs financial umbrealla is a moot point, the mistake has been made. To start a process that lengthy now to aim for next Christmas would be farcical in this climate.

It's clearly not ideal not to have their own branded item but to stay in the game they need to have A branded ereader and why not the biggest brand of them all?

When Waterstone's first developed a website in was in conjunction with Amazon which confused customers and it has to be said they were too late developing their own. Amazon and the Kindle are now synonymous with e-reading so will anyone bother to use the Waterstone's website at all either for e-books or indeed physical books?

'Daunt declined to say if Amazon was putting money up-front as part of the deal, but said the arrangement would "facilitate' the investment in IT within stores, the roll-out of coffee shops, and staff training.' Will there now be an area of Waterstone's shops emblazoned with the Amazon logo? 'Publishers will continue to deal with Amazon and Waterstones separately' and as Amazon have the better negotiating power they will strike the better deals.

It seems a very bizarre alliance and one tipped very much in Amazon's favour.

It has been said that Kindle is to e-readers what Hoover was to vacuum cleaners. So what if one of the big electronics brands wants a chance to be the next Dyson?

If a big player develops a device that can compete with Kindle hardware. W merchandises it alongside the Kindle with a bonus that it will be bundled with QUALITY books chosen by W Booksellers... or any number of other book orientated incentives...

Just a thought.

You're correct Meerkat,I've often been asked for Kindles by customers,meaning e-readers,in the same way Hoover is used for vacuum cleaners and Coke for colas (no-one asks for a Pepsi that way do they?)I'm on holiday at the mo' so it was a surprise (The Nook I thought,too) and I even phoned into work to make sure it was so.Being a dedicated bookseller(for over 20 years)I certainly don't want physical bookselling to die and still love what I do.Booksellers are often underestimated in their role;true,some are only part-time or in the trade short term,but many of us realise that we have to fight for our trade and will meet the challenge head-on.I just hope James has a grand gameplan...

But that's already happening. Now that Microsoft has bought into the Nook, which presumably is the reason for this desperate move by Waterstones, the perfect Big Boy/technology development scenario is happening. Unfortunately for us it's only happening in the US. Will they have an integrated Nook app in Windows 8, the tablet OS? We'll see.

I don't believe it is too late or to expensive to be in the hardware ebook device business. There are a myriad of ways to co-develop and offset costs. There are potential partners over the globe who one could work with. It is about, imagination, imitative and innovation in business today.

Just one example would have been to create an alliance with B&N with the Nook for the British market. Develop a new business model for the two firms to share. A device specially designed for the British book buyer and the Commonwealth could have huge value. The British have a substantial potential market around the world in the English language to offset costs and is already there is a mature distribution system in place.

The Nook is now a brand. Waterstones needs to think about how they want to brand themselves in the market place and at the same time generate assets. The Nook as many know is a big asset as is the Kindle in the U.S.

One could seek partnerships with publishers and government to off set costs as well.

Just a range of ideas that come to mind now.

Robert Gottlieb
Chairman
Trident Media Group, LLC
www.tridentmediagroup.com

Hi Robert,

Really? Enough money and enough time? You did see the size of the investment Microsoft has just made in B&N? You must have seen how much W was sold for last year?

We're 30 weeks away from Christmas week.

This should have been in the works for at least 20 months. At the very least. It wasn't and that was a mistake. Whether or not it was an avoidable one considering W was under HMVs financial umbrealla is a moot point, the mistake has been made. To start a process that lengthy now to aim for next Christmas would be farcical in this climate.

It's clearly not ideal not to have their own branded item but to stay in the game they need to have A branded ereader and why not the biggest brand of them all?

Yes "really" Bookseller.

Does this mean then that Waterstone's as well as giving up on developing a device themselves have also given up on selling e-books on their own website? Whatever amount Waterstones get when someone purchases from Amazon must be a price Amazon are willing to pay but to what end? As Daunt himself said they are 'a ruthless money making devil' so are they just playing the long game and waiting for Waterstone's to commit a long, slow and painful hari kari? As someone else said if Waterstone's can find tens of millions to improve their stores could they have not used that to develop their own device or go into partnership with a company and shown some corporate responsibility by allowing it to be compatible with library catalogues? Are not most of their coffee shops concessions anyway with those chains putting their money in? Most of Piccadilly is concessions now and I am not sure if its claim to be be Europes biggest bookshop in terms of books is still true.

Is this Mamut's price for funding the Waterstone's investment and re-fit? Did Mr Daunt have a choice? Oligarchs ride again?

It makes an investigation into the monopolistic levaiathan named Amazon even more urgent.

Presumably those booksellers who had the temerity to suggest that the Kindle was a better device than the Sony Reader when Waterstone's stocked that exclusively will have the black mark against their names removed?