It's a good day so far for Barnes & Noble
In a bid to expand on the college-bookstore presence of Barnes & Noble, Microsoft has pumped $300 million into a joint venture between the two companies, tentatively called "Newco." This new subsidiary of Barnes & Noble will blend its college textbook business with the Nook e-reader, hoping to place more Nooks and e-books into the hands of college students. Microsoft will retain a 17.6% interest in the new business.
Perks are already piling up, such as a new Nook app for Windows 8 and the fact that the companies will be putting their heads together in regard to research and development from here on in. Though there are no plans in the works yet, Microsoft may use Barnes & Noble to market its own products as well.
Barnes & Noble and Microsoft are not the only heavy hitters to encourage the movement of textbooks onto a proprietary digital format. Apple
Apple is concentrating its e-textbook initiative on the K-12 market, however, and, according to Cultofmac.com, there are some very good reasons for this. The biggest reason is choice, which is available to students at the college level, but not at secondary and high school levels. School committees and other public entities generally make textbook and school-supply decisions, which take the guesswork out of how many units of a certain product a company can expect to sell. As it turns out, Apple made a good bet: Apple, its publishing partners, and a slew of other participants recently took part in an industry-federal government symposium regarding a joint effort to convert American public schools over to a completely digital format within five years.
This deal is a win for both companies, but particularly for Barnes & Noble, whose fortunes have been languishing lately. It's too soon to tell, but there's a good chance that this new business initiative will finally give the Nook a leg up on Amazon's Kindle -- which would be a symbolic victory for the company, as well as a financial one.
Yes, it's been a great day for Barnes & Noble. Investors will surely be keeping a close eye on how the rest of the year goes.
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