Microsoft To Buy Nook For $1 billion

Techcrunch reported that Microsoft has offered $1 billion to buy the digital assets of the Nook Media LLC, which is a joint venture of Barnes & Noble and other investors. Microsoft has expressed willingness to buy preferred amount of units of Nook Media, which also has a college book division. The report also revealed that Nook Media is planning to discontinue the Android based tablet from its range by the end of the year 2014, and it is planning a transition to a model where content from Nook is distributed through apps in third party tablets. It was not clear that if the new third party tablet will be from the house of Microsoft, or by others or both. The third-party tablets are expected to come in action, in 2014.

A decision of Microsoft to buy the Nook Media seems an obvious second step of the company. Microsoft partnered with Barnes & Noble on its content and Nook devices in the month of April 2012, for a $300 million deal. The deal also included an advance of $180 million for developing contents for the Windows 8 devices, which is the current assignment with the Nook.

Including tablets and e-readers, till date 10 million Nook devices has been sold and it has more than 7 million subscribers. Microsoft’s interest in Windows 8 has become limited though the company claims to have sold more than 100 million licenses in the first 6 months. Currently the app from Nook is available for all the major platforms including iOS, Android and Windows. In last October, Microsoft had a $300 million deal with Nook Media to split from its retail arm which amounts to 16.8 per cent stake of the company. The aim of the deal was to get contents of B&N on Windows 8 which was just out of the shelves at that time.

Declination from Nook to go with the latest proposed deal by Microsoft is a result of alteration in its strategy, and Leonard Riggio, the founder of Barnes & Noble has proposed to buy back the whole retail operation of the company. However, the performance of the Nook division has seen a slow growth this year.

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