Information Technology Reference
In-Depth Information
often inefficiently run, with understocking, overstocking and limited
shelf space. It is difficult for them to compete with the large chains,
supermarkets and in particular with Amazon, as each tries to undercut
the others. The most recent Harry Potter novel has a published list price
of £16.99, but Amazon is selling it for £4.99 and it was reported that
one supermarket was selling it for £2.99. It would seem that Amazon
is the 'big gorilla' in the booksellers' market. It can sell more books
more cheaply, it does not have a shelf-space problem, it can site its
warehouses in low-cost areas, and does not need to rent expensive retail
outlets on the high street.
Changes in technology which provide the ability to sell cheaply have
impacted on the bookselling business before. Charles Edward Maudie
founded his circulating library in London in the 1840s and in the
following 20 years it expanded to become a dominant force in the UK
book trade. Like Amazon today, Maudie took advantage of the new
technologies of the time: rail, steamship and the postal services. Like
Amazon, Maudie was also able to sell cheaply. For the annual fee of one
guinea, the customer was entitled to the loan of a volume which could
be exchanged as often as one wished, and this was at a time when the
average three-volume novel cost a guinea-and-a-half (£1.57). Maudie
enjoyed a near monopoly and could claim huge discounts of around
50% from the publishers. This monopoly was finally challenged with
the abolition of the three-decker novel in favour of the single-volume,
six-shilling (30p) novel.
An interesting thing about Maudie's model is that the purchaser
leased rather than bought the topic. This model is one already in
operation in the DVD market. For example, LOVEFiLM allows
subscribers to choose from a library of over 65,000 films. The DVD is
delivered by post the next day, and can be kept for an undefined period
of time, with no late-return fees. Once the users have finished with
films, they return them and another film of their choice is sent the next
day. Membership fees are low, around £3 to £15 per month and the
number of loans is unlimited. A similar model might work with e-
books, providing that the right technology, digital rights management
and e-book reader were available.
Is it possible that the Kindle and other portable e-book readers are
going to provide alternative models of access and purchase and, in the
process, make booksellers obsolete? These devices are already lighter
