Are bookstores doomed to extinction?

Tim O'Reilly has an interesting post titled Why Using ShopSavvy Might Not Be So Savvy in which he states that using applications like ShopSavvy and RedLaser to do price-checking while in a store is ultimately unsustainable as widespread adoption of this habit will eventually lead to brick-and-mortar stores going out of business.

I got alerted to the article by a friend since my own iPhone app, 'avit, is mentioned in the comments by Michael R. Bernstein:

There probably isn't much to be done for brick-and-mortar stores except to emphasize the possibility of walking out of the store with the product *right now*, as opposed to waiting for a delivery, but that requires more emphasis on books and other merchandise as desirable physical objects. Because when you toss ebooks and other non-physically-embodied formats into the mix, even that slim advantage goes away, and you can get immediate electronic delivery.

We're already seeing moves in this direction such as 'avit:

Now, 'avit is interesting because it tries to point the user to an electronic copy that the user (or their employer) have already paid for (via a Safari subscription), rather than trying to drive a new ebook purchase, but if Safari doesn't have the book in question, it does redirect you to Google Product Search.

Tim's definitely got a point, and it was made all the more personal for me when Borders, including the local one I frequented in Brighton, shut down recently. However, I feel that this is simply the reality that the advent of electronic reading and the Internet is presenting us with. O'Reilly's own Safari Books Online service, for example, made 'Avit possible and online services like Safari compete directly with brick-and-mortar bookstores. What bookstores need to do in this new age is to find new ways to compete. And I sure hope that they do because I, for one, love bookstores.

So how can traditional brick-and-mortar bookstores compete?

The easiest way is one that I've already begun to notice in some stores: they appear to block mobile signals. I don't know if it is by design or coincidence (or just crappy o2 reception), for example, but I get no signal whatsoever in my local HMV. That, combined with not providing WiFi access is one way to battle the lowest-price look-up issue. However, it feels like a shortsighted one.

So, beyond blocking mobile signals, what can bookstores (and other media retailers) do?

Here are some initial thoughts:

I realize they're not much to go on so please feel free to leave your own in the comments.