Microsoft Buys In To Barnes & Nobles Nook Business
Microsoft is investing $300 million into Barnes & Noble — the makers of the Nook line of eBook readers. This news started spreading on Monday morning and was quickly followed up with another piece of news that had Microsoft paying an extra $180 million for revenue sharing on an upcoming Windows 8 version of the Nook App. And later, it was found out that they were also paying $120 million to NewCo — a new subsidiary owned by Barnes & Nobles that will hold the entire Nook business. So put together, it is clear that Microsoft is working its way in to the Ebook business and has already spent $600 million on it.
Microsoft has thus become only the latest player in the market where players like Apple and Google are already working on providing these services to their users through their own means. Both of them have tablets and both have their own brand of eBook services. Out of the two, only Apple has a fully branded eBook experience — iBooks. Google has both the Amazon Kindle and B&N Nook Apps for the Android (as does the iPad) and has it own Google Books initiative.
Microsoft does not have an eBook business so far and that is what these deals with B&N are all about. Windows 8 will thus serve up eBooks from B&N primarily and also hopefully through its own version of Amazon’s Kindle App. But only the Nook app will generate separate revenue for Microsoft thanks to this deal.
The partnership between the two will ensure that Microsoft has a trusted content provider in this regard whilst B&N has a company that will help them get more exposure and stay relevant in the eBook business that is currently being dominated by Amazon and its Kindle.