Microsoft has bid $1 billion to buy the digital assets of Nook Media, the e-book business led by Barnes & Noble, according to a report published late Wednesday.The news sparked immediate enthusiasm on Wall Street, where the bookseller's stock price was up 18% as of early Thursday afternoon. But, despite the excitement, an all-important question remains: If Microsoft goes on to consummate the rumored deal, what will it get out of the acquisition?
TechCrunch broke the news, claiming it had acquired internal documentsthat revealed not only Microsoft's offer, but also plans to phase out Nook's Android-based tablets by the end of 2014. An anonymous source told The New York Times that the documents are authentic and only a few weeks old. According to the Times, which noted that Nook was valued at $1.8 billion as recently as December, it is not yet clear if a deal will be closed. Microsoft has so far declined to comment, but the Times source claimed any announcements are at least weeks away.
Buying a business to close it down is a disservice to the avid "Android Nook" readers and a questionable use of Microsoft shareholders' assets. Where does Microsoft want to play in the future in the continuum between hardware, services, and software? To win in the long run, Microsoft must offer products that people want. Extinguishing the competition only works until a new competitor arrives on the scene.
I think MS's hope is to get a good foothold in the ebook market, introduce a new format for epublishing and so lock out android tablets. I suspect they will be willing to lose a lot of money on it too, just to squeeze out Android. The biggest threat to MS is how well Android/Linux works in conjunction with how much people dislike W8. I think we are almost at the point where almost everything MS sells is commodity technology and will be replaced by free versions. Lockout seems to be their only way out.
What does B&N get from this? They are the last major brick & mortar bookstore chain. If they sell off the Nook Digital Media, they are giving up the future to hold onto a less profitable past.
Nook is not locked to hardware. Both the Nook and Amazon Kindle aps are free on the iPad. They want to sell books, not hardware.
I own two Nooks (the reader and tablet) as well as a Nexus 7. Both Nooks were for "readers" for my wife. As soon as it was available, I stuck an N2A card (https://www.n2acards.com/) in the Nook Tablet and got rid of the "locked" B&N Tablet software. Much happier and much faster. In my opinion, any of the "locked" devices are bound for extinction anyway. B&N missed the boat; they could have just put an actual Android image on the thing and dominated; instead, they chose to try (try being the operative word) to lock people into doing things "their" way. I'm sure a bunch of people made the money they wanted to and have moved on.
You do have to wonder at what MS has in mind. You can download a working reference design for a "tablet" design from many manufacturers of the core processors. The hardware is moot; they'll never convert existing devices to any form of Windows, just too impractical. By the time they'd get around to it, the hardware will be ancient, so why bother? A "tablet" running some broke dick version of Windows; I think not.
Say what? Several commenters talk about "proven device" and "good user experience that Nook has".
I do indeed have a good user experience with my Nook, but the article says "...plans to phase out Nook's Android-based tablets by the end of 2014".
So goodbye good user experience, hello Windows 8. Sad sad.
What a great way to goof up a good user experience that the Nook currently has. One of the big draws to the Nook is the access to the Android world of apps (advertised to be around 700K). I doubt many of the current users would opt to replace the software in the Nook with Win8RT and it would ultimately fork the UI. I think Microsoft would do this out of desperation, but I hope for the sake of the Nook community that it doesn't happen.
The move will definitely deflate the market shares of Android OS and improve the market share of Windows OS. Maybe, Microsoft wants to prove to the world that Windows 8 Mobile is robust and will be able to run on not only high end platform but also low end.
Buying Nook can help MS get into ebook business and compete with Amazon/GoogleBooks/Apple iBooks etc. Also get access to the cheap tablet business and compete with Amazon kindle/and Nexus devices... Both are pretty low margin business and can become a loss leader for its Win mobile OS.
The Nook would give Microsoft another presence in the handheld device market. Plus by going into a proven device, it brings new awareness to microsoft software, that was probably already in the device, but it would now be more prominently identified.
Its a nice, safe and subtle way for microsoft to grow its business and name awareness.
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