Microsoft enters the e-book game with Barnes & Noble’s Nook

Microsoft is entering the e-book market by investing in Barnes & Noble’s Nook e-book. It is said to be investing $605 over a period of five years. As the digital publishing industry is thriving and the downloadable college books will be the next big thing, this will give Microsoft a successful entrance.

Microsoft will soon be launching its touch enabled Windows 8 operating system. Adding the Nook app to the tablets with the new operating system will make it a good competitor for Apple’s iPad and Kindle by Amazon.

An analyst said “It’s a good strategic deal. It gets Microsoft in the game for e-readers, and gives them access to a market that has been growing nicely and they’ve basically sat out of. It also makes Windows 8 a more compelling platform from an e-readers perspective.”

This is a much needed investment for Barnes & Noble. It put itself up for sale in 2010 but found only one taker, Liberty Media. Liberty Media saw the potential that Nook had in the market. Instead of buying the whole company, Liberty Media invested $204 million.

Through Microsoft’s investment the company gets to further its reach outside the United States. After the investment, the Barnes & Noble’s shares saw an increase up to 90 percent and now rest at $20.75 per share.

Microsoft initially has invested $300 million and will follow it up with $305 million in the next five years.

Though Microsoft provides the most widely used operating system and software for personal computers around the world, they dint keep up with the mobile revolution. Millions of people have traded their personal computers for smartphones and these phones use Android by Google or Apple.

The first version of Nook was launched in the year 2009. Since then it has managed to reach 27 percent of the U.S e-book market. Amazon enjoys 60 percent of the market while Apple managed only 10. Last month, it released glow in the dark version of the Nook. But, with the competition it faces from Amazon and lowering the prices to keep up with it, the profits have suffered.

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