Borders Returns to Online Sales, Drops Amazon

The nation's second-largest book chain made the move as it continues to lose market share both to online retailers and to discounters such as Wal-Mart Stores Inc. amid a difficult economic climate.

We are a bookstore - and we have to be a real bookstore online, said Kevin Ertell, Borders' group vice president of e-business. We really tried to make (the site) feel like a Borders store.

The move to establish its own Web site could be crucial to the retailer's future success. In 2001, Borders turned over its money-losing online business to Amazon. Under that arrangement, Borders.com took shoppers to a site partnered with Amazon, while a Web site for its stores allowed shoppers to check inventories and reserve items.

Shares were recently down 8.5 percent at $6.15, while Amazon was up 0.24 percent to $78.54 in afternoon trading.

The decision to partner with Amazon, at the time it was made, was made I think for very good reasons, said Kevin Ertell, the vice president for e-business at Borders.

Now the world has changed significantly. It's right for us now to own our own e-commerce experience and to tie into stores and really connect with our customers in a way we could not do in a partnership with another company.

Borders used to only get a percentage of online sales from Amazon in profit, pushing d the bookseller behind competitors such as Barnes & Noble Inc., which sells hundreds of millions of dollars worth of merchandise through its Web site annually.

The site also allows users to purchase used books through a partnership with the online retailer Alibris, and copy-protection-free audio-book downloads through the digital media distributor OverDrive.

We've invested significant capital and resources in the development of this new site and are delighted that with its launch, we can move it forward from pure investment to a sales and profit generator, Borders' president and chief executive officer, George Jones, said in a statement.