Growth at Amazon outpaces brick-and-mortar booksellers

Amazon's sales of books, music and video rose 15 percent last year, while sales at most other retailers were flat. A new breakdown of the North American book market published by Morris Rosenthal shows that Amazon's media sales exceeded those of brick-and-mortar giant Borders for the first time.

Sales rose slightly to $12 billion during 2006, according to figures drawn from the annual reports, SEC filings, and news releases from Barnes & Noble, Borders, Amazon, and BN.com.

An excerpt:

Within the Barnes & Noble and Borders chains, book sales are falling at their small stores (B. Dalton and Waldenbooks) which are being shut down and replaced with superstores. In 2005, Amazon bought BookSurge LLC, an aggressive POD company whose performance had hitherto been limited by their lack of access to Amazon. They don't break out Booksurge in their annual report, but Booksurge published 3,980 titles in 2006 and is up past 10,000 titles overall.

Although Amazon registered strong sales growth last year, the percentage of sales resulting from Marketplace merchants selling new and used books failed to increase for the first time ever. Marketplace accounted for 28 percent of Amazon's sales during 2006, the same as 2005.

Rosenthal estimates that because of Amazon's overall growth, Marketplace sales rose about 15 percent compared to 2005. But the share of Marketplace third-party sales relative to Amazon's sale of new items stalled, perhaps because of Amazon's heavy promotion of its Super Saver and Prime shipping programs. Last year on Marketplace, Amazon began displaying listings for its own merchandise above better deals by third-party merchants -- unless sellers undercut Amazon by more than the price of standard shipping.