Microsoft Invests $300M in Barnes & Noble Nook

| News

Microsoft is getting into the ebook reader game, in a manner of speak, with a US$300 million investment in the Barnes & Noble Nook. The investment will give the Windows maker a 17.6 percent stake in a new Barnes & Noble subsidiary for the Nook business, and will lead to Windows 8-based Nook ebook reader app, too.

The deal follows a patent infringement battle where Microsoft accused Barnes & Noble of using technology it owns and controls in the Nook ebook reader without proper licensing. As part of the settlement, Barnes & Noble gained a royalty-free license to use the patents in question in its ebook reader and tablet products.

B&N plans to consolidate its digital business and College business under the new subsidiary company while promoting the Nook ebook reader.

Microsoft invests in Barnes & Noble NookMicrosoft invests in Barnes & Noble Nook

“The formation of [the new subsidiary] and our relationship with Microsoft are important parts of our strategy to capitalize on the rapid growth of the Nook business, and to solidify our position as a leader in the exploding market for digital content in the consumer and education segments,” said Barnes & Noble CEO William Lynch.

He added that the planned Windows 8 Nook reader app is expected to help expand the company’s presence in the digital book market. Currently, B&N’s Nook app is available for iOS and Android, but not Windows.

B&N’s deal with Microsoft could help the book retailer better compete with Amazon and it’s popular Kindle ebook reader product lineup and Apple’s iPad. What’s more likely, however, is that B&N will take some marketshare away from Amazon while the iPad maintains its top player position.

Regardless of where the growth comes from, B&N is counting on its deal with Microsoft to push up numbers. “Microsoft’s investment in Newco, and our exciting collaboration to bring world-class digital reading technologies and content to the Windows platform and its hundreds of millions of users, will allow us to significantly expand the business,” Mr. Lynch said.

Popular TMO Stories

No Comments

Log in to comment (TMO, Twitter or Facebook) or Register for a TMO account