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Barnes & Noble rewrites its Nook tablet strategy

Barnes & Noble is getting out of the color tablet business (mostly). It announced Tuesday that it will cease production of its color Nook tablets -- although it plans to allow third parties to produce them, under pending licensing deals.

Could this be a punt to Microsoft, which made a major investment in Nook Media, the Nook-focused unit that Barnes & Noble spun off last year?

Even the experts don't know. "One thing still not clear from the announcement today: How Microsoft and U.K. publisher Pearson are looking at the Nook business," the Wall Street Journal writes. "The two companies own minority stakes in Nook Media.... For Microsoft, the big deal was in technology. 'The overarching goal is to jointly create compelling experiences across a range of Windows devices,' [Barnes & Noble CEO William] Lynch said in a call announcing Barnes & Noble’s partnership with Microsoft in 2012, 'allowing users to buy, consume, create and publish content in new and exciting ways.'”

In a report on earnings, Barnes & Noble blamed its unsold inventory of Nooks, in large part, for losses of nearly $155 million for fiscal year 2013.

Although there were drops in sales of the Nook across the board, it's solely the color tablets that Barnes & Noble is giving up. It will continue to develop its dedicated e-readers, including the Simple Touch and Glowlight, which may appear as devices co-branded with a manufacturer.

"We are 100% not exiting the device business," William Lynch, chief executive of Barnes & Noble, insisted on a conference call Tuesday.


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