Borders Books Teetering on Bankruptcy?
"Borders, the struggling book chain, said on Sunday night that it would delay more payments to its vendors and landlords as it tried to preserve cash and avoid bankruptcy," the New York Times reports:
Borders, the struggling book chain, said on Sunday night that it would delay more payments to its vendors and landlords as it tried to preserve cash and avoid bankruptcy.
In a statement, Borders said the delay was “intended to help the company maintain liquidity while it seeks to complete a refinancing or restructuring of its existing credit facilities and other obligations.”
Borders, the second-largest book chain in the United States, added that it “understands the impact of its decision on the affected parties.”
It is the second month in a row that Borders has delayed payments to vendors. In late December, Borders abruptly informed publishers that it would not make a scheduled payment, and later asked publishers to convert the missed payment into a sort of loan.
Publishers have not been persuaded to accept Borders’ proposal. Several publishers said last week that Borders executives had not addressed the fundamental issues that drove the company to its current troubled position.
In talks with Borders last week, several publishers did not formally reject Borders’ proposal, but made it clear that they were not inclined to accept it.
An executive at one major publisher said on Sunday night that the announcement was only the latest sign that Borders was headed toward bankruptcy.
In related book news, ebooks for Amazon's Kindle outsell paperbacks for the first time. As one of Ace's co-bloggers notes:
I love my Kindle and I buy e-book versions of novels whenever I can, but still...I find this news unsettling. There are some fairly deep questions about what will happen if books go the way of film cameras and music CDs. E-books can't be loaned or re-sold, and can be "lost" forever if your device malfunctions or gets broken somehow (though the "cloud" model in theory allows you to re-download, what happens if the "cloud" goes down?). All the same caveats that apply to digital music also applies to e-books, and more besides.
It just seems to me that we are rushing into a paper-book-free world without really considering what that really means.
If Amazon ever gets into similar financial difficulties as the Times describes Borders as being in or worse, presumably whoever acquires the chain would continue to service the Kindle. But that's potentially another issue with the Kindle and other electronic readers: if the bookseller associated with your reader ever tanks, your tomes have hit the fan if and when your reader crashes.
(Which isn't going to stop me from buying more books for my Kindle, but still.)
Article printed from Ed Driscoll: http://pjmedia.com/eddriscoll
URL to article: http://pjmedia.com/eddriscoll/2011/1/31/borders-books-teetering-on-bankruptcy