Microsoft makes $300M deal with Barnes and Noble on e-reading.
Microsoft is making a $300M investment in the B&N subsidiary to get an edge over Amazon and Apple in the market for e-books and the devices used. The team is called up to have a strategic partnership.
It will include all of its Nook Business as well as educational college stuff. The new company, name yet to be decided, known as Newco as of now, will contain B&N’s digital business along with the educational division. While Microsoft will take 17.6 percent, B&N will own 82.4 percent of the venture.
This will give more content to the Microsoft platform to compete against the iPad and the Kindle Fire from Amazon, which has stolen the market, not only of its low price but also the fact that it allows seamless access to all of Amazon’s e-book offerings and the other e-reader companies as well.
This is also and progress with the funding of the developers for Microsoft, to make sure that apps are developed for the windows8 phone platform and in the other way, increasing content on the platform.
The legal twist to the deal is: the two companies say they have definitely sorted out their patent litigation now : “Moving forward, B&N and Newco will have royalty-bearing license under Microsoft’s patent for its NOOK eReader and tablet products,” as written by the two companies in the press release.
There are many other questions- such as what is its effect on the company’s strategy of growing the market for Nook and how well those products are doing for the company. IDC puts the Nook’s share of the tablet market to be 3.5 percent only.
Will get you more update on the same as more information is revealed by the two companies….