More writing on the wall for e-readers

(Previously: here and here.)

Barnes & Noble Reports Record NOOK Sales

During the nine-week holiday period ending December 31, 2011, NOOK unit sales, including NOOK Simple Touch™, NOOK Color™ and the new NOOK Tablet™, increased 70% over the same period last year. Sales of NOOK Tablet exceeded expectations, while sales of NOOK Simple Touch lagged expectations, indicating a stronger customer preference for color devices.

So, Barnes & Noble's only e-ink device, the second largest competitor in the space after Amazon's Kindle, saw lower sales than expected while their tablet (generally agreed upon to be a better actual device than the Kindle Fire supported by a lesser--but improving--store) beat expectations. Enough so that B&N is considering spinning Nook off as a separate operating segment.

Once more I'll say it:
E-readers are probably doomed because they just won't make the kind of money these tablets and integrated stores are capable of bringing in. Some day in the not-so-distant future, B&N and Amazon will drop their e-ink readers. When that happens I'll hold on to mine until it dies unless someone pulls it from my cold dead fist.

If I end up having to eat this prediction, though, I'll do it gladly. Anything based on today's LCD technology, or anything similar to it will never advance in such a way that I'll prefer the actual act of reading full books on them to reading them on the Nook Simple Touch I have in my bag right now. I'd love to see e-ink displays look even more like high quality paper than they already do.

→ Amazon is doing its real job: Squeezing retail chains

Amazon is doing its real job: Squeezing retail chains

Dan Frommer points out any possible battle between the Kindle Fire and iPad is small potatoes in the short term compared to the retail business.

Recall that e-commerce is still less than 5% of U.S. retail sales. So driving brick-and-mortar competitors into the ground and directing more spending toward Amazon is absolutely what Amazon should be putting most of its effort into.

After referencing a few well-known retail chains and their dimishing forecasts, here's the gold nugget:

Meanwhile, Wall Street expects Amazon to report 40% year-over-year sales growth for last quarter, and a profit.

I’d love to see some contrarian evidence — signs that offline chain spending is picking up in categories where Amazon is a serious competitor. Or that any of these companies stand a chance to survive as digital-only companies. (Hey, at least Walmart just bought an iPhone app agency.)

But from my own habits, I can’t imagine why that would happen.

→ HBO stops providing discs to Netflix

HBO stops providing discs to Netflix

The Verge's Nilay Patel:

The move is said to be "largely symbolic," as Netflix still owns whichever discs it purchased previously and can still legally purchase future HBO discs from other parties and rent them to customers under the copyright doctrine of first sale. (Indeed, Netflix says it will continue to offer HBO DVDs and Blu-rays, although it's never had any HBO content on its streaming service.)

Netflix will now be in direct competition with HBO when it starts airing its self-published shows. This kind of thing reminds me how bad it is for the consumer when content providers and delivery channels are the same entity.

This reminds me of EA and Valve having a spat over EA's games in the Steam store only after EA opened its own Origin store. It's interesting that my gut is to give Valve a pass on their integration but having a bad feeling about Netflix producing their own content. Maybe it's because Steam has already become the defacto PC store and is free to access (you only pay for the games you want to have on it, not a monthly fee), while anyone wanting to watch Netflix produced "television" who doesn't already have an account will have to sign up for a paid service they don't already have.

That might not be it, though. I'll have to ponder.