I feel like this has been going on forever and a day, but now it's official.
I've never shopped at Borders because 1) I worked for B&N for so long and, 2) I always thought it was kind of dirty. And I'm not really the best when it comes to figuring out what this means for economy.
But the fall of Borders seems an omen for the fall of the giant brick & mortar stores, including B&N. If you've walked into any Barnes lately, you'll notice the large, large amount of floor space NOT dedicated to books. Toys, Games, Gifts for Readers, and DVDs claim more room than those things made up of a lot of paper.
Digital is the way things are headed. Not just e-books, but stores like Amazon & bn.com have really great online offerings that require you not having to leave your home in this heat as well as super fast delivery. If you live in NYC, bn can get you your book SAME DAY. That's just crazy.
Still - I don't think this spells the death of the print book and of book stores in general. There will always be those people who crave the bookstore experience. I think the recent surge in new independents is a good sign of what's to come. And these new independents focus on an expanded consumer experience. One amazing store here near where I live offers book clubs, writing classes and even writing retreats - not to mention rows upon rows of books that smell like books and not toys & games.