UK megastore Waterstone’s gets a rough, coldfingered, butterless rectal exam from The Guardian under the headline “How Waterstone’s killed bookselling“. You know, I bet today’s a bad day to be in Waterstone’s PR department. But then again, they probably looked at their paycheques and thought, ah, fuck ‘em.

So the argument goes: in going big, Waterstone’s lost its soul. It gains credence if you consider what is happening in the US. There, Amazon and Wal-Mart are fighting a discounting war. If you really must buy Sarah Palin’s Going Rogue, you can get it from Wal-Mart or Amazon.com for 60% less than list prices, which means the two competitors are probably selling the titles at a loss.

How can they afford that? For Wal-Mart and Amazon, books can be loss leaders, luring customers in so that they might then buy other merchandise which does make a profit. The only sure-fire losers in this war are the booksellers who have no other merchandise. Bigger US booksellers such as Borders and Barnes & Noble have suffered alarming drops in share prices recently. Smaller ones face oblivion.

“Waterstone’s has really already done to British bookselling just the kind of things that we’re seeing in the US,” says Spice. “By competing with supermarkets, they can’t afford to care about the quality of what they’re selling.”