Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Price War for Apple and Amazon?

Don't let it get away!

Keep track of the stocks that matter to you.

Help yourself with the Fool's FREE and easy new watchlist service today.

A price war in e-book readers broke out this morning, but neither (Nasdaq: AMZN  ) nor Apple (Nasdaq: AAPL  ) fired the initial shot.

Barnes & Noble (NYSE: BKS  ) is lowering the price of its Nook e-reader to $199. It was probably easy to see this coming, since Barnes & Noble was offering a $50 gift card with the purchase of a $259 Nook earlier this month.

However, the retailer won't stop there. Following Apple's iPad by offering cheaper non-3G gadgetry, Barnes & Noble is also introducing a $149 model that relies solely on Wi-Fi connectivity for downloads. Barnes & Noble is also teaming up with AT&T (NYSE: T  ) to offer Nook owners free access to B&N's online storefront, plus limited Internet surfing, via its stores' Wi-Fi networks.

Barnes & Noble should have done this all along. Matching Amazon's Kindle at the $259 price point was a gutsy move. Sure, the Nook supplements its E-Ink screen with a neat color touchscreen, a feature the Kindle lacks, but Amazon has the brand and market-share leadership. Barnes & Noble and Sony (NYSE: SNE  ) have to compete on price, especially now that the dedicated Kindle is threatened by the jack-of-all-trades iPad.

How will Apple and Amazon react to the Nook's price cut? Apple is unlikely to flinch, since its multifaceted iPad is already selling briskly. Owners may have downloaded 5 million e-books during the iPad's first two months on the market, but it's still perceived as a portable tablet for email and leisurely Web browsing.

Amazon is the more likely juggernaut to fire back. It has been gradually slashing its Kindle's price tag since its introduction at $399 three years ago, and Nook's new price points can't be ignored.

The leading online retailer realizes that it needs to smoke out new leads outside of its digital storefront. It finally began selling its Kindle through Target (NYSE: TGT  ) earlier this month.

Barnes & Noble can't stop there. The Nook quietly raised the bar with its dual screen and e-book sharing feature, but those specs will become more tempting, now that the device is considerably cheaper than Amazon's Kindle. Since most readers are compatible with rival online bookstores, price points and spec sheets are bound to matter.

Your move, Amazon.

Will Barnes & Noble be a legitimate player in this space after this morning's moves? Share your thoughts in the comments box below.

Apple and are Motley Fool Stock Advisor recommendations. Try any of our Foolish newsletters today, free for 30 days.  

Longtime Fool contributor Rick Munarriz has been shopping online for about as long as has been in business. He owns a Kindle and an iPad. He does not own shares in any of the companies in this story. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.

Read/Post Comments (0) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1213790, ~/Articles/ArticleHandler.aspx, 10/9/2015 2:03:22 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Rick Munarriz

Rick has been writing for Motley Fool since 1995 where he's a Consumer and Tech Stocks Specialist. Yes, that's a long time. He's been an analyst for Motley Fool Rule Breakers and a portfolio lead analyst for Motley Fool Supernova since each newsletter service's inception. He earned his BBA and MBA from the University of Miami, and he now lives a block from his alma mater.

Today's Market

updated Moments ago Sponsored by:
DOW 17,052.49 1.74 0.01%
S&P 500 2,010.31 -3.12 -0.15%
NASD 4,820.78 9.99 0.21%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/9/2015 1:47 PM
BKS $12.94 Up +0.07 +0.54%
Barnes & Noble CAPS Rating: *
AAPL $111.78 Up +2.28 +2.08%
Apple CAPS Rating: ****
AMZN $538.24 Up +5.08 +0.95% CAPS Rating: ***
SNE $26.54 Up +0.12 +0.45%
Sony Corp (ADR) CAPS Rating: **
T $33.11 Down -0.29 -0.87%
AT&T CAPS Rating: ****
TGT $78.58 Down -0.11 -0.14%
Target CAPS Rating: ****