Microsoft + Barnes & Noble Team Up on Nook ("Game-Changer")

[Badger3920]

The bookseller announced this morning a plan to spin off its digital and college divisions into a subsidiary and partner with Microsoft (MSFT) in a digital reading venture the two companies have dubbed Newco. The Windows creator will invest $300 million in return for a 17.6 percent equity stake in the new business. Goldman Sachs analyst Matthew Fassler called the deal a "game-changer."

Barnes & Noble shares surged about 60 percent Monday on news. Microsoft shares were flat.

"To me, the key takeaway is this guarantees the long-term viability of the Nook," said Bob O'Donnell, an analyst at IDC.

From a technology angle, it makes sense: Microsoft and Barnes & Noble need each other to better compete in the e-reader and tablet business. Fassler wrote, "Our biggest concern for BKS has been its ability to compete against AAPL (Apple) and AMZN (Amazon), two of the deepest-pocketed players in the technology and media world. NewCo now has an equally deep-pocketed partner."

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I'm unsure I really see this as being anywhere near a "game changer." It seems to me that the Nook was having a tough time. On a side note, "NewCo" is a pretty unimaginative name lol.

[nickoakdl]

I'm pretty sure the nook is doing pretty well. They also have the e-ink backlit e-reader coming out which will give them a leg up on the kindle.

[Badger3920]

I'm pretty sure the nook is doing pretty well. They also have the e-ink backlit e-reader coming out with will give them a leg up on the kindle.

Oh maybe I was mistaken, I thought the nook had been suffering

[rm082e]

Much like the Zune, it's a good product that's getting hammered by a bigger competitor who's marketing the shit out of their product (Kindle). I don't see this as a game changer for anything.