Microsoft bails out Barnes and Noble

4 May

Thus far, Barnes and Noble’s Nook has made little headway in the tablet competition. With a heavily saturated market, e-book readers must really excel to get attention. Investors worried that Barnes and Noble’s tablet division wasn’t making the grade had their fears eased when Microsoft injected $300 million in Barnes and Noble for a minority stake in the company. Not only will the capital help the production of a new, competitive Nook, Barnes and Noble will also likely be releasing an app for the new Windows 8 tablet.

With Amazon’s highly popular kindle, and of course, Apple’s iPad, both Microsoft and Barnes and Noble have a fair amount of competition. Also, newcomers to the field such as Google aren’t making the highly competitive arena any easier. By joining forces, Microsoft and Barnes and Noble hope to do together what neither can do apart: Take first in the tablet and electronic book market.

Barnes and Noble’s market share price took off with the surprise announcement, skyrocketing to a three year high of $24.09. The jump was $10.41, a 76% increase from their prior cost. Microsoft’s stock also rose slightly less impressively to $32. An interesting fact on this deal is that Barnes and Noble’s tablet features technology from up and comer Google, working from their proprietary tablet operating system. This also means that when Microsoft releases its next volley of tablets, they’ll still be markedly different from Barnes and Noble’s offerings to the same field.

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