Chain Power : The furor over ‘Satanic Verses’ has revived debate on book publishing and distribution.

The decision last week by the nation’s two biggest bookstore chains to pull Salman Rushdie’s “The Satanic Verses” from their shelves has brought a new outpouring of complaints about the chains’ tremendous influence on how widely books are distributed and even which ones get published.

On Wednesday, the B. Dalton-Barnes & Noble chain reversed its position not to sell the novel, and Waldenbooks has promised to resume selling the book from its stockroom when new copies arrive from the publisher. But all the same, many in the book world say the incident again demonstrates how much power the chains have acquired since their explosive growth began in the mid-1970s. When the chief executives of the two top chains yanked the book, they blocked sales in about 2,200 of the country’s roughly 7,000 general-interest bookstores, critics say.

The critics, who include writers, publishers and independent bookstore owners, say the chains’ power is exerted quietly every day as they decide which books to carry. With the huge orders that they place with publishers, and with their enormous promotional budgets, the chains’ decisions help assure that some works will be best sellers while others are consigned to obscurity.

And as the chains offer their mass-market inventory at discount prices, they can also force out of business the independent stores that try to make their way selling a broader selection of less popular works, as well as blockbusters, the critics say.

First Amendment Defenders

The chains, of course, have staunch defenders in the book industry, who see merit in their concern about their employees’ safety and praise the big firms for bringing low-price works to neighborhoods that have never had book outlets.

Since the furor over “The Satanic Verses” began last week, booksellers have confronted questions of whether they have an obligation to bring books--even controversial ones--before the public. Some say that they do and that the chains have not lived up to that obligation, as the independents have.

“The chains are brilliant at marketing, and they’ve changed the face of the bookselling industry,” said Mona Mangan, executive director of the Writers Guild of America East. “But they don’t have that commitment to getting books before the public. It’s the little neighborhood bookstore that’s out there today defending the First Amendment.”

The president of the booksellers’ trade group that includes the Waldenbooks and B. Dalton-Barnes & Noble chains also said he found “some merit” in criticism of the chains’ withdrawal of the book.

“Unfortunately, this illustrates the Achilles’ heel of centralizing the industry,” said Edward Morrow, president of the American Booksellers Assn. and owner of an independent store in Manchester, Vt. The chains’ decisions meant that the book wouldn’t be available at all in some communities, he noted.

As the chains pulled the book, Morrow said, independent bookstores continued to take orders for it, including several that had received bomb threats. “I’ve talked to a lot of independent stores in the last couple of days, and I haven’t talked to one that said it didn’t want to sell the book,” Morrow said.

Will Remain in Stockroom

But Morrow and others in the book trade also saw the rationale behind the chains’ decision. “They’re extremely visible and extremely vulnerable because of their size and locations in so many shopping malls,” Morrow said. “It’s not as easy to ensure everybody’s safety at these little outlets as it is if you just own one store.”

“This is not an example of the venal corporate mentality taking over the book business,” added William Kramer, president of the two-store Sidney Kramer Books in Washington. “There are legitimate concerns at stake.”

The B. Dalton-Barnes & Noble chain announced Wednesday afternoon that it would begin selling the book again in about 10 days, when it receives its next supply. The chain said it reversed the decision after a poll of employees found “overwhelming” support for selling the book.

The Waldenbooks chain, which last week decided to take Rushdie’s novel off its shelves and sell it only on request, said it would resume selling the book when it comes back in stock. The chain also said it would continue “to use discretion in displaying the book.”

In an interview, a spokesman for Waldenbooks denied that the chains have excessive influence on the bookselling business. “We account for only 10% of the books sold in this country,” the spokesman said. “There are thousands of other places books can be sold.”

45% Market Share

The B. Dalton-Barnes & Noble chain did not respond to repeated requests for comment, nor did Crown Books.

Despite the comment of the Waldenbooks spokesman, the influence of the chains is enormous and growing, although at a slower rate than in the early 1980s.

If Waldenbooks accounts for only 10% of all book sales, Waldenbooks, B. Dalton-Barnes & Noble and Crown Books together account for nearly 45% of the general-interest fiction and nonfiction works known as trade books, according to Jim Baker, editor of Publisher’s Weekly. While exact figures are not available, the three leading chains’ market share is believed to have risen from about 40% in the early 1980s, he said.

B. Dalton-Barnes & Noble has about 1,250 stores, while Waldenbooks, a unit of K mart, has about 1,200. Crown operates about 200 stores.

The chains’ influence has been felt in many ways by authors, publishers and competitors.

They have brought a new management expertise to the business, with slick promotion and marketing techniques, computerized inventory control and other features that make traditional booksellers look stodgy and outdated. With the chains’ backing, a book’s sales can quickly climb into the hundreds of thousands.

But without the chains, publishers and authors lose their access to huge chunks of the American audience. And this often makes them desperate to get their books onto the chains’ shelves.

Blockbuster Syndrome

Without a large chain order, “you have to consider whether you can raise the price for each copy of the book” to cover costs, says Los Angeles publisher Jeremy P. Tarcher, who heads a firm that bears his name. Or “you may decide that, with such a small press run, the book just isn’t economically viable” and decide not to publish.

Writers complain that the rise of the chains has increased publishers’ interest in the mass-market blockbuster at the expense of worthy books that might interest a smaller group.

“The publishers were always interested in promoting the potential blockbuster at the expense of other books, but the chains have made it worse,” said Alec Dubro, president of the National Writers Union.

The chains’ emphasis on the potential blockbuster often comes at the expense of so-called mid-list books, which are neither the best sellers (“front list”) nor classics (“back list.”) These can be the work of first-time or less well known authors.

For the most efficient use of display space, the chains also typically keep books in inventory for shorter periods, to the dismay of writers and publishers.

And the chains’ presence can put pressure on small publishers, though most small publishers aim at narrow rather than mass markets.

Small publishers are confronted with a dilemma when the chains offer them a large order. If they decline to accept the full order, they may risk losing future business from the chain; if they accept the full order, they may later face the crushing expense of a large number of returned copies.

“A giant leaves large footprints,” said publisher Tarcher.

Unfair Treatment Charged

Independent bookstores have long complained about the difficulties of competing in a world where the chains have narrowed profit margins to razor-thin size. “You’ve got to love books to be an independent, because there’s just not that much money in it,” said Glenn Goldman, president of Book Soup, a bookstore in West Hollywood.

Last December, the Federal Trade Commission sided with independent booksellers when it filed complaints against six of the largest trade publishers for allegedly selling hardback books at lower prices to chain stores than to independents. The agency also charged that the publishers treated the chains better in joint advertising programs and in providing promotional displays. The publishers have denied the charges.

Book lovers have sometimes found that their sympathies lie with the independent bookstores in their competition with the chains. When the elegant, 75-year-old Scribner’s bookstore on New York’s Fifth Avenue closed last December, some book lovers took it as another sign of the decline of the old-fashioned bookstore--though the store had recently carried only a limited inventory.

But the chains’ admirers argue that the growth of the chains has brought stores to many neighborhoods that had no book outlets and reduced book prices to within the reach of many who could not afford them in the past.

Moreover, in the past several years, there has been a resurgence of the independent bookstores, though there are no firm statistics to describe the trend precisely. This is partially attributed to a greater interest in books among the aging baby boom generation.

Indeed, some industry officials, pointing to the slowing growth of the chains, believe that their importance may decline in the years ahead.

“Big companies like CBS and RCA got into the book business and got right out of it when they discovered it was no gold mine,” said Jack Shoemaker, editor-in-chief of North Point Press in San Francisco. In the years ahead, “corporate America may get out and leave it entirely to the little guy.”

THE BIG GET BIGGER The three largest bookstore chains have steadily increased their market share in the period between 1980 and 1987. Percentages are based on total retail revenue (including trade, mass market and religious book sales) of $2.3 billion in 1980 and $3.8 billion in 1987.

1980 Smaller chains and independents 73% B. Dalton/Barnes & Noble 15% Waldenbooks 11% Crown Books 1% 1987 Smaller chains and independents 50% B. Dalton/Barnes & Noble 25% Waldenbooks 21% Crown Books 4% Source: BP Report