Microsoft considers $1 billion Nook Media acquisition
By Shona Ghosh
Posted on 9 May 2013 at 09:38
Microsoft has reportedly offered $1 billion for the assets of Nook Media, its ebook and tablet joint venture with Barnes & Noble.
According to the terms of the deal, seen by TechCrunch, the firm would acquire its preferred assets from the digital operation, namely ebooks and the Nook hardware.
Microsoft already owns a 17.6% stake in Barnes & Noble’s Nook subsidiary after a $300 million investment in April last year. As part of the deal, Microsoft agreed to pay out an additional $305 million over the next five years in return for Nook content on Windows 8. The two companies also shared revenue from content and hardware sales.
ReviewFind out why the Nook HD is great hardware for the price
Analysts suggested that Microsoft has gained little from the deal so far, and speculated the two companies could produce a Nook tablet running on Windows software. Currently the tablets run on Google’s Android and have just begun to include Google’s app store, Google Play.
But according to the documents, Nook Media is planning to axe its line of Android tablets entirely by the end of its 2014, phasing out hardware in favour of licensing content to third parties. Those third parties could mean Microsoft and its manufacturing partners, or competitors. Nook won’t actively phase out ebook readers, but the company expects sales to decline as consumers naturally trade up to tablets.
Barnes & Noble has sold ten million Nook devices to date, but reported the division "fell short of expectations" during its most recent quarterly earnings.
"naturally trade up to tablets"
I have an e-reader and I have a tablet. Exchanging one for the other is certainly not trading up. It’s accepting a jack of all trades versus the master of one.
By JamesD29 on 9 May 2013
From my simple world view
I assumed the Nook was the Betamax to the Amazon Kindle VHS.
By revsorg on 9 May 2013
I'm guessing the price reduction on the Nook Touch and Glow is no coincidence then. Makes it look a bit like a fire sale. Shame, as JamesD29 says, the only people who would consider swapping to a tablet to be trade up is someone who hasn't used an eInk screen or doesn't like reading. They're different. I have both too.
By mrtrilby on 9 May 2013
Got a house and a car?
Why not trade up to a motor-home?
By synaptic_fire on 9 May 2013
I agree. I have a Kindle, a tablet and a smartphone. Neither the tablet nor the smartphone are a suitable replacement for the Kindle.
If I am waiting at the doctor's and want to quickly read a few pages, the smartphone is fine. The same for waiting at the airport on a day-trip to visit a customer, but neither are really suitable for reading large amounts of text, compared to the eBook reader.
By big_D on 10 May 2013
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