Barnes and Noble reverses course; will still design its own Nook tablets

A couple of months ago, bookseller Barnes & Noble announced it would seek a third party partner to design and build new versions of its color Nook tablets. Now Barnes & Noble has reconsidered that idea and announced it will continue to design the Nook in-house.

Today's announcement, as part of Barnes & Noble's quarterly financial results, comes after the company's CEO William Lynch resigned in July, with Michael Huseby taking on the title of president of Barnes & Noble afterward. In a press release, Huseby said, "The company intends to continue to design and develop cutting-edge NOOK black and white and color devices."

He expanded on that statement in a conference call with analysts, saying, "Some kind of wholesale outsourcing of our color device business is neither appropriate nor is it smart for the company." Huseby added that the designs of the Nook tablets are not the problem and defended their device team, saying, "... they don't deserve to have their jobs outsourced to somebody else."

Barnes & Noble plans to release "at least" one new Nook product sometime before the end of 2013, and advises that more hardware products are in development. In today's reveal of the company's last quarterly financial numbers, their Nook business brought in $153 million in revenue, down 20.3 percent from the same period a year ago.

In April 2012, Barnes & Noble and Microsoft announced a partnership that got Microsoft to invest $300 million in the Nook division. Barnes & Noble did not comment on the current state of that partnership, with company executives saying only that the deal with Microsoft was supposed to help expand the Nook's digital content internationally and that those plans were still in place.

Source: Barnes & Noble | Image via Barnes & Noble

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16 Comments

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Even the Nook app on Windows 8 is a PITA to use outside of the US... I WANT TO GIVE THEM MY MONEY, but they don't want it.

I think it has less to do with them not wanting your money and more to do with them not having the licensing necessary to sell ebooks outside of the US or UK. Ebooks generally are very locked down. I tried to buy some books from an Australian author from an Australian website and they wouldn't take my money either, because I don't live in Australia. I think you can't even buy from the Nook UK store if you live in the US or vice versa.

Australia has laws in place that promote the sale of local published books above others (very draconian ones too). That's a different issue.
B&N Nook have no excuse. I buy my e-books from Amazon UK, my girlfriend buys them from Amazon USA… licensing is not an issue. Amazon want my money, and will facilitate me being able to easily access their content. B&N just put up walls, or rather, don't take them down.

People thought that the MS and B&N deal would be for Nook devices but that was never the plan. MS has it's own hardware with the surface and it's own music and video service with Xbox, games as well etc. The only area MS lacks is in books/magazines and specifically school/education related content that B&N has. The whole Nook deal IMO was for them to get that content on their hardware to fill the gap. Now you see them starting to target schools and education more with the Surface and so on.

I don't know when it'll happen exactly, because these copyright/licensing deals take so long, but I expect MS to announce some big book/mag content deal that they will add to the updated Windows Store post 8.1 update etc. Heck, why not make some special area where B&N can connect right into the Windows Store (store in a store) MS gets it's little cut, some reduced % and B&N gets direct access to every Windows device?

Amazon is a jack of all trades and Barnes and Noble is a bookstore, yet the Kindle is more widely associated with ebooks than the Nook is. WHY?! B&N really needs to work on their marketing. I like the Nook so much better than the Kindle, and I am thrilled to hear that my HD+ may not be the last generation of the Nook. But I am sick of being asked if I have a Kindle or an iPad. It doesn't make any sense why they are losing to Amazon. They need to continue to improve Nook services and really push marketing. They might want to consider the next generation of Nook being a Windows RT 8.1 device with the Nook app preinstalled, but then again, with all the FUD surrounding Windows 8 similar to how it did Vista, that might not be the best move for them right now.

Darrian said,
Amazon is a jack of all trades and Barnes and Noble is a bookstore, yet the Kindle is more widely associated with ebooks than the Nook is. WHY?!

1. Amazon started as a online bookstore
2. Amazon operates globally, whereas B&N is totally unknown outside the US (+ Canada)

MFH said,

2. Amazon operates globally, whereas B&N is totally unknown outside the US (+ Canada)

Not only are they not known, they refuse to ship you any of their tablets in most countries...whereas Amazon will gladly charge you extra for an "international edition" Kindle, B&N offers no such option.

MFH said,

1. Amazon started as a online bookstore
2. Amazon operates globally, whereas B&N is totally unknown outside the US (+ Canada)
I suppose their presence in the UK doesn't count then? Anyway, it shouldn't matter. Americans aren't from Europe. If they're selling to Americans and their only market is America it doesn't make sense why they aren't dominating in America. Except for some reason their Nook products aren't very well known, and again, I think it has to do with advertising. It's not like they are not advertising at all, but I think that they are not doing it well. Amazon is very aggressively advertising the Kindle and it looks like it's paying off.

It's not like I want Amazon to fail (though even if they did with the Kindle, as unlikely as it seems now, they'd still be pefectly fine since it's only one of many products they offer). I just can't understand how B&N can put out a better product at a cheaper price and not have them flying off the shelves.

I wasn't aware that B&N was present in the UK - somebody should tell Wikipedia, as they don't even mention that…

Let's just hope we're not witnessing another RIM Job here and they do something before they become insignificant - both financially and in the eyes of customers.

Seems plausible .. but then if it's MIcrosoft effect, we should expect some Windows 8 or RT stuff from B&N too .. I don't think we've heard anything in that effect yet.

efjay said,
Must be the Microsoft effect....

With it running Android. Makes sense since Microsoft makes more money from a competitors product than their own