ATG Article of the Week: Barnes & Noble and Microsoft Form ‘Newco’ — A New Chapter for Ebooks

 Barnes & Noble and Microsoft Form ‘Newco’—A New Chapter for Ebooks

In this article, Nancy K Heather reports on a surprising turnaround.   Barnes & Noble and Microsoft have resolved their differences and then some.  Not only have they come to an agreement regarding a contentious lawsuit over patent infringement, they have formed a partnership that appears to be a win-win.  According to the deal Barnes & Noble will receive a much needed “infusion of $300 million from Microsoft” that should “help shore up the NOOK platform and allow for further innovation (most probably based on some form of MS Windows operating system).”   And from Microsoft’s perspective the partnership “offers a chance to capture a segment of the ereader, apps, and tablet markets—something it has failed at, despite a strong historic interest in the areas dating from CD-ROMs in the 1980s.”

Ms. Herther does a commendable job in explaining how this partnership evolved from what started as a law suit between B&N and Microsoft.   However, perhaps the most intriguing aspect of the article is what is says about the evolving market for reading devices and tablets.  After spending some time discussing how Amazon and Apple fit into the discussion, she observes that “the market is clearly heating up. Apple, Amazon, and other major players are working hard to solidify the market and their positions. The MS/BN partnership only adds to the mixture and ensures a more interesting, and hopefully diverse, playing field.”

Obviously, the stakes couldn’t be higher.   This is a extremely lucrative market with significant growth potential.  But regardless of how the battle over market share shakes out, readers and other users can only benefit from the increased competition – and that includes librarians and publishers.