The partnership comes in the form of an investment – a large one, at that. Microsoft isn’t investing in Barnes & Noble exactly, but in a new, to-be-named subsidiary that will combine Barnes & Noble’s Nook and college bookstore businesses, which hopefully somehow means cheaper textbooks (or eTextbooks) for students, because anyone who has checked out a textbook price lately knows how bad things have gotten in that department. That large investment is to the tune of $300 million, making Microsoft an 18% owner of the new enterprise.
What role Microsoft will play in the new Barnes & Noble subsidiary is unclear, but what is clear is that the partnership will also result in a Nook app for Windows 8, bringing the Nook eBook store along for the ride. That’s big news for both companies. Barnes & Noble, which until now has only seen Nook revenues from the United States, will expose its eBook store to international markets for the first time, once the app is published. Microsoft, on the other hand, will be saved from the trouble of having to make its own competing eBook store, making the Nook store its go-to media store for Windows 8. As far as partnerships go, this might have been the best one realistically possible for Microsoft – Barnes & Noble owns a 30% market share in eBook sales in the United States.
Does this mean Nooks running Windows 8 are in our future? A Windows 8 Nook seems unlikely, since the value of the Nook brand lies with its user interface, not so much its hardware – a Windows 8 Nook would essentially be just another Windows 8 tablet, which would be a harder sell than the eBook-focused Nook. The Nook, which is now based on a simplified version of Android (similar to the Kindle Fire), takes advantage of the open nature of Android to create its own brand of smooth user interface – Windows isn’t an open source platform. That said, there’s no telling what the future holds, or what will happen if the companies decide they want to get a little closer over the next few years.
Microsoft gets a successful digital media store for Windows 8, and Barnes & Noble sees a huge increase in the distribution of is digital wares. As far as partnerships go, it doesn’t get much more win-win than that.