UPDATE: Barnes & Noble (Probably Not) Ditching the Nook

B&N Ditch The Nook

Photo STILL courtesy of Delilah S. Dawson

UPDATE:

Via: Wall Street Journal

Speculation over a company's decisions can cause a lot of bad press, and we're sorry to report that we got caught in the mix.

Recently we ran a story about Barnes & Noble and the future of their Nook product.  Originally, it was believed that the Nook was on its way out, however, that's actually not the case. B&N's official position as of now is that they are still in a state of consideration, i.e. nothing's official yet.  Here are the hard facts of what's going on with that particular product and the overall company:

-On Thursday (01/05) Barnes & Noble stock fell 17%. This puts the company in one of the most critical states it's yet to experience.

-They control approximately 27% of the digital book market, citing that they, "...saw more growth with e-books with Barnes & Noble this Christmas than anybody else."

-Regarding the aforementioned sales increase: this came at a cost of up-front expenditures. Namely, developing, manufacturing and promoting the eReaders and tablets. They even went back to TV advertising after a 14-year absence. Since 2009, B&N has tripled their advertising budget, and this has subsequently put a strain on their bottom line.

-On Thursday, Barnes & Noble increased its projected loss per share for the current fiscal year to between $1.10 and $1.40, from the 30 cents to 70 cents it reaffirmed one month ago. We reported earlier that the shareholders weren't happy and this is one of the main reasons why. B&N is blaming this on an unexpected shortfall of sales of the Nook Simple Touch e-reader. Nook Color did very well as consumers continue to embrace products like that one and the Kindle Fire.

-Now here's where some major clarifications come in regarding the Nook: Barnes & Noble said in a statement on Thursday it was "in discussions with strategic partners including publishers, retailers and technology companies in international markets." One possibility here is that B&N could sell a minority stake of the Nook product for public offering, and so B&N would still be closely involved with the Nook product. The other possibility is that they sell the Nook arm of their business off outright. Again, no decision has been made, but we'll update when the verdict is made available.

-Edward Latessa, a portfolio manager for Aria Partner, estimates the Nook business being worth around $1.5 billion.


Via: The Examiner

It's a good thing Jane Lynch already got her paycheck for doing that cheesy Nook commercial, because that particular tablet is going the way of the dodo, my friends. After announcing that their year end numbers were 'much lower than expected' (a polite way of saying: bad), Barnes & Noble is scrambling to make investors happy with a little damage control, and the Nook is going to be one of the casualties.

Don't cry for them, Argentina. This tablet war between the Nook, Kindle, and iPad was basically an unfair version of Risk from the get-go. Cheers to them for holding on to what little piece of real estate they had while Apple and Amazon set record numbers. There simply wasn't enough room on the board for all of them, and Barnes & Noble found itself isolated in the Ukraine surrounded on all sides.

The funny thing about this is that Barnes & Noble actually considered selling off the Nook tablet right around the time Borders was filing for bankruptcy. Instead, they chose to accept more money from investors (John Malone and Liberty Media) in order to make the line successful. Bad play on their part. Sales of the new $99 Nook eReader fell way short of their predictions and now the investors are all hot and bothered.

In other sad news, as part of their scramble to get their money right, B&N has announced it's cutting its Sterling Publishing branch and putting it up for sale. Yes, you read that right: their print gardening line is going bye-bye.

Opinion time: is Barnes & Noble in a chokehold or what? 

Image of Wicked as They Come (A Blud Novel)
Author: Delilah S. Dawson
Price: $6.59
Publisher: Pocket Books (2012)
Binding: Mass Market Paperback, 416 pages

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Comments

Jason Stuart's picture
Jason Stuart January 5, 2012 - 4:14pm

They will file bankruptcy within the year. 

Jason Van Horn's picture
Jason Van Horn from North Carolina is reading A Feast For Crows January 5, 2012 - 4:35pm

:wipes forehead: I'm glad I ended up going with my Kindle Fire choice then

aliensoul77's picture
aliensoul77 from a cold distant star is reading the writing on the wall. January 5, 2012 - 4:36pm

This will make way for my new publishing invention called The Paper.  It's books, written on real paper!

EricMBacon's picture
EricMBacon from Vermont is reading The Autobiography of a Corpse January 5, 2012 - 4:41pm

Is it just the nook tablet? Between the headline and the picture, I am a bit confused. I checked for a similar article on another website, and everyone is making the same mistake. Is it possible that B&N are dropping all forms of the Nook? (Simple Touch, Color, Tablet?)

 

This is unfortunate because the B&N hardware is much superior. I am for open source epub books, and the tablet itself is much more open. Amazon created a sandbox similar to apple and it is restricted, and yet because of the size of Amazon, they are in the process of basically building a monopoly on media forms. The only thing that I did not like about the Nook Simple Touch was the shape of the device. It looks cheap, and feels a bit awkward. Amazon did design their last few Kindles properly, I will say that.

Ebooks should be DRM free, or at least there should be a format that is supported across hardware platforms. Choice is good for competition. Amazon doesn't allow competition, and floods their eBook shelves with poorly written garbage and niche trash. There are so many indie publishers out there that should be recognized, but it is hard to wade through the filth. We should have a page that is our virtual bookshelf where we promote new indie works on a weekly or monthly basis. It could be poll driven so there is a consensus on what books are put forth. I do have confidence in the community at LitReactor to recommend some pretty good reads.

Mike Goldstein's picture
Mike Goldstein January 5, 2012 - 5:01pm

Sources? I have yet to find an article supporting this. I found one from today in the WSJ that said they were considering it, but that sales of e-books and the Nook Tablet were up, while the Nook Simple Touch were down. Doesn't seem like they've made a concrete decision yet.

While I appreciate the Seinfeld link, it's not exactly a source.

Delilah S. Dawson's picture
Delilah S. Dawson January 5, 2012 - 5:13pm

Hi! I'm Delilah S. Dawson, the girl in the photo used for this article-- the one with the broken Nook that looks like a bustier sprouting from Gertrude Stein's neck. That photo appeared on my blog at www.delilahsdawson.com, and it's totally fine that you use it, although I would love credit, especially if you can link it up with the paranormal steampunk romance I have coming out with S&S this March, WICKED AS THEY COME. Which, might I add, is available for pre-order on Nook and Kindle. I read 42 books on my new, unbroken Nook last year and love the crud out of that machine.

Joshua Chaplinsky's picture
Joshua Chaplinsky from New York is reading A lot of Brian Evenson January 5, 2012 - 5:30pm

Busted. It was the most interesting picture that came up when I Googled "broken nook." Credit where credit is due.

avery of the dead's picture
avery of the dead from Kentucky is reading Cipher Sisters January 5, 2012 - 6:19pm

Right now all B&N has going for them in their (dwindling) college division.  The Nook platform has given them a bump in digital textbooks, but Amazon is slowly but surely killing them. 

And with their current business model, it's no wonder.  Their website is actually competing with their brick and mortar stores.  You can get the exact same book from bn.com for cheaper than you can get it in a B&N store.  For whatever sense that makes.  The reasoning is that the website is in direct competition with Amazon, but it is directly shooting themselves in the foot.  The left hand doesn't know what the right hand is doing.  The stores can't give the same prices as the website.  It's insane. 

Jason C's picture
Jason C from Quad Cities, Iowa is reading Growing Up Dead In Texas by Stephen Graham Jones January 5, 2012 - 9:39pm

The stores also have to pay for the employees that work there, supplies such as coffee cups, toilet paper, hand soap, bags, rent.

And if there's any bookstore that will declare bankruptcy this year, it will be Books a Million.

Suzie Queue's picture
Suzie Queue January 5, 2012 - 11:23pm

Yeah, I don't think anyone should trust this article. I work for B&N and the Nooks are selling like hotcakes. Our store just took out bookshelves to put in about four more Nook counters. The tablet just came out and we're selling them by the piles. Even Consumer Reports rated Nook higher than any other e-reader. The information in this article seems way out of left field and screams propaganda. Maybe it's an attempt to balance out all of the bad reports coming in about the Kindle Fire.

Jason C's picture
Jason C from Quad Cities, Iowa is reading Growing Up Dead In Texas by Stephen Graham Jones January 5, 2012 - 11:38pm

Took this from the Huffington Post article...

"Still, combined sales of Nook products were brisk, up 70 percent compared with a year ago during the nine-week period ended Dec. 31. Digital content sales more than doubled. The company expects those sales to total $450 million in fiscal 2012."

http://www.huffingtonpost.com/2012/01/05/barnes-noble-nook_n_1186288.html?ref=books&ir=Books

 

Jason C's picture
Jason C from Quad Cities, Iowa is reading Growing Up Dead In Texas by Stephen Graham Jones January 5, 2012 - 11:52pm

After reading The Huffington Post and WSJ's story and the comments from both, this article is just a bunch of bullshit.

Arkadia's picture
Arkadia from Australia is reading The Wasp Factory by Iain Banks January 5, 2012 - 11:58pm

What happened to her hands in that photo?!

I don't know anything about Nooks. What does this mean for the people who purchased them?

Jason C's picture
Jason C from Quad Cities, Iowa is reading Growing Up Dead In Texas by Stephen Graham Jones January 6, 2012 - 12:19am

People who bought Nooks will be just fine.

bryanhowie's picture
bryanhowie from FW, ID is reading East of Eden. Steinbeck is FUCKING AMAZING. January 6, 2012 - 12:34am

I hope the Nook does great.  The more e-readers and tablets, the better.  

Jason C's picture
Jason C from Quad Cities, Iowa is reading Growing Up Dead In Texas by Stephen Graham Jones January 6, 2012 - 12:50am

It's doing more than fine but investors want more. They run things like idiots. You can call it a "farmers almanac" way of doing things. If your store did $18,000 on this day last year, they expect you to do $18,500 this year. Never mind that on last year's date, there was Dan Brown's first book since The Davinci Code and this year, there's nothing to get excited about. And if you don't reach your goal, you lose "hours" and if you end up too many hours in the hole, you run skeleton crews at your store and then customers complain that service is shit, so they stop coming and you struggle to regain those "hours".

Then the new fiscal year starts and you hope they lower that goal to be more realistic, especially with the economy sucking for three years straight, but nope...the goal is pretty much the same as last year and the cycle continues.

Delilah S. Dawson's picture
Delilah S. Dawson January 6, 2012 - 4:26am

Arkadia, I do henna on my hands every year on my birthday. You can buy a kit at Joanne's Fabric for about $10 and scribble all over yourself, and it sticks around for 2 weeks or so.

Razvan Teodor Coloja's picture
Razvan Teodor Coloja January 6, 2012 - 8:57am

I bought a NooK Classic WiFi way back, and chose it because of EPUB support. I still do all my reading on it and passed on the new Kindle because my old Nook was that good and comfortable. Sad to hear B&N doesn't do well.

TommySalami's picture
TommySalami from New Jersey is reading Killing Floor, by Lee Child January 6, 2012 - 9:14am

Was this supposed to generate a lot of hits with a misleading, shocking headline? Don't turn into HuffPo. They sold 70% more Nooks this year. They were disappointed with sales of their cheap tablet, but not with the high end one.

And they are considering spinning off the Nook division, but we are not sure if that means putting it under its own management (a sane division) or selling it off (insane).

 

aliensoul77's picture
aliensoul77 from a cold distant star is reading the writing on the wall. January 6, 2012 - 4:35pm

@Brandon--defend yourself, man! lol

Suzie Queue's picture
Suzie Queue January 6, 2012 - 10:18pm

I spoke with my managers and they said that B&N isn't trying to get rid of the Nook. They just want to seperate is from B&N so that it can be sold internationally. Right now, B&N doesn't have the liscenes to sell internationally. There is a specific company (one that owns a lot of cable channels, but I can't recall the name for the life of me) that is connected to B&N who is likely going to take the Nook, should this become an actuality. What does this mean for B&N and those who own the Nook? Not much. We'd still sell it in our stores just like we do now and your Nooks would work just as they always did. The only difference is that the Nook could now be sold over-seas.

aliensoul77's picture
aliensoul77 from a cold distant star is reading the writing on the wall. January 7, 2012 - 12:54am

 I love Barnes and Noble, they are the best bookstore in the universe.  That is all.

Arkadia's picture
Arkadia from Australia is reading The Wasp Factory by Iain Banks January 8, 2012 - 8:15am

Thank you Delilah, I was going nuts squinting at the picture trying to work it out. I bought a henna kit in Singapore about ten years ago... I wonder if it's still good!

Hetch Litman's picture
Hetch Litman from Ojai, Ca. is reading Plainsong trilogy by Kent Haruf January 8, 2012 - 7:16pm

Phew! Just bought one for damn near every member of my family for Christmas.