Microsoft helped Nook Media split from the retail arm of B&N last October with its $300 million investment. It was valued by Microsoft for a 16.8 percent stake in the Nook Media LLC. At the time of the deal, the partnership was aimed at getting B&N content on Windows 8 tablets through Nook apps. There were various reports and rumors about Windows based Nook device, but it didn’t happen. Today, TechCrunch reports that Microsoft is planning to buy Nook Media business for about $1 billion.
Microsoft is offering to pay $1 billion to buy the digital assets of Nook Media LLC, the digital book and college book joint venture with Barnes & Noble and other investors, according to internal documents we’ve obtained. In this plan, Microsoft would redeem preferred units in Nook Media, which also includes a college book division, leaving it with the digital operation — e-books, as well as Nook e-readers and tablets.
The documents also reveal that Nook Media plans to discontinue its Android-based tablet business by the end of its 2014 fiscal year as it transitions to a model where Nook content is distributed through apps on “third-party partner” devices. Speculation about the plan to discontinue the Nook surfaced in February. The documents we have are not clear on whether the third-party tablets would be Microsoft’s own Windows 8 devices, tablets made by others (including competing platforms) or both. Third-party tablets, according to the document, are due to get introduced in 2014.
Apart from the access to Nook media content partnerships, I’m not sure why Microsoft would want to buy Nook’s declining business which is also facing heavy competition from Amazon. Is Microsoft planning to enter e-books business for the second time?