Microsoft faces the book market. The electronic ones, of course. The IT giant made in the USA has invested $300 million ebook business at bookstore chain Barnes & Noble, which produces the Nook reader, a direct competitor to Amazon's Kindle. The partnership could lead Barnes & Noble to separate the digital business from the traditional one.
According to the Wall Street Journal, Microsoft will get 17,6% of the company which will arise from the covenant. One of the first consequences of the agreement between the two companies will be the inclusion of a Nook application in Windows 8, the expected operating system by the end of 2012.
The agreement represents the end of tensions between the two companies, which in recent months had come to loggerheads over issues related to intellectual property. Microsoft had taken the bookstore chain to court accusing it of infringing on some of its patents. But now the judicial disputes are water under the bridge.
Barnes & Noble aims to use Windows 8 as a sounding board to increase Nook sales worldwide, thus regaining ground on the two industry giants, Apple and Amazon. "Microsoft's investment and the new partnership will allow us to expand the business," commented William Lynch, CEO of the chain, with satisfaction.
Massive investments to increase Nook's market share have hit the company's coffers heavily so far. In February, Barnes & Noble announced that its digital business reported a loss of $93,7 million in the fiscal third quarter, down from a loss of $50,5 million a year earlier.
