Death to eBooks?

In a surprise move, Barnesandnoble.com (Nasdaq: BNBN  ) has stopped selling eBooks. The online retailer is in the process of e-mailing its affiliates to let them know of the program's demise this week.

Wow.

One would think that a virtual bookseller would embrace the eBook format like a scrawny bookworm would a willing supermodel. With unlimited inventory and immediate delivery, it's a dot-com's dream before we even begin to touch on the huge margins associated with digital delivery.

If bricks-and-mortar chains are down to instant gratification as the sole selling point over cheaper online options, eBooks are the ultimate argument ender.

The digital format has also created a cottage industry through such online marketplaces as Clickbank, which give authors, regardless of pedigree, the ability to peddle eBooks with the viral incentive of giving affiliate marketers huge commissioned royalties.

So why did the site give up so soon? The eBook is too young to die. As a matter of fact, many of our own research products like Hidden Gems and the new Income Investor take advantage of digital distribution to get our freshest stock ideas delivered to subscribers right away and in a cost-effective manner.

While the early eBooks got slammed by complaints of the eye-straining consumption process, that's not the case these days. Reader software by companies like Microsoft (Nasdaq: MSFT  ) and Adobe (Nasdaq: ADBE  ) have taken the "eeek" out of the eBook.

While Amazon (Nasdaq: AMZN  ) is best known for its shipped goods, it still sells eBooks. At a substantial discount to its printed counterpart, some of the cost savings achieved through digital delivery are passed on to the end user.

With Barnes & Noble (NYSE: BKS  ) as BN.com's majority stakeholder, one has to wonder if the company is missing the high-margin potential of the medium or if the sales just aren't there. Or, for the budding conspiracy theorists out there, is BN.com simply refusing to promote a niche where its parent company can't partake or one that promotes a level playing field in an arena where publishing house suppliers are used to the advantages of size?

eBook fans would like some answers. Unlike its warehouse-shipped forefathers, an immediate answer would be welcome.

Will Barnesandnoble.com dropping its eBooks catch on? Will Amazon follow suit? What are the prospects for these companies as we head into the holiday shopping season? All this and more -- in theAmazon discussion board. Only on Fool.com.

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