
Microsoft Makes $300M Investment In Barnes-Noble E-books Subsidiary - iProject
http://techcrunch.com/2012/04/30/microsoft-barnes-noble-partner-up-to-do-battle-with-amazon-and-apple-in-e-books/
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btipling
I realize there is more to the deal than just the Nook Color/tablets, but I
think it is interesting to imagine that either the Nook will continue to run
Android and Microsoft will now be involved with selling Android devices or
existing apps already purchased will not work on future versions of a non-
Android Nook device.

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pdubs
I'd imagine that Microsoft doesn't really care what the device runs. The
money's in the content, not the hardware.

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rbanffy
Microsoft has a lot at stake - WP7, as it is now, lacks credibility and that's
absolutely critical in this "post-PC" world. Nooks running WP7 (and abandoning
Android) could generate some.

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joenathan
They would run WindowsRT if anything, Microsoft is only using WP for phones.

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rbanffy
IIRC, Microsoft has said WP8 will be based on the same core as Windows 8, so,
whatever the tablet runs, will be a successor of WP7.

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joenathan
People have speculated that is what MS will do, but MS has never said that.

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rbanffy
You are right. Microsoft has, so far, been ambiguous about the rumors about W8
and WP8 common infrastructure.

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obtino
Unsurprisingly, thanks to this deal, the patent dispute has been settled. Here
I was thinking that B&N would be the company which finally ended Microsoft's
ludicrous patent claims over Android.

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nextparadigms
Now that you mentioned it, maybe Microsoft was afraid not only of losing a few
hundred million dollars to B&N (which they ended up paying anyway in this
investment, on top of what the digital division of B&N was worth), but that
they will further invalidate more of what they thought were their "important"
patents that they are using to get money from other companies.

Was it Motorola or B&N that invalidated 6 out of 7 of their patents? I think
both managed to invalidate quite a few. If only the other companies would grow
a pair, too. Who knows, maybe Microsoft will end up investing in them, too,
just like with B&N.

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ZeroGravitas
This is the only explanation of this that makes sense to me.

I love how they slip the standard "royalty-bearing licence" text into an
agreement when they're giving a company widely regarded as struggling nearly
0.3 bilion dollars. I assume the only reason the other firms aren't revolting
over this is that they already secretly negotiated better deals which led to
their agreements, again with the publicity highlighting the "royalty payments
to Microsoft" and _nothing else_ about the deals.

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cek
My first reaction: I feel pain for the old Microsoft Reader team, and Bill
Hill, who pioneered a bunch of e-reading stuff and were shut down last year.
Sucks being a victim of Microsoft's not trusting its visionaries.

My second reaction: Microsoft just paid B&N $300M to ensure that Android
continues to fragment. B&N now has the resources to really take Android
forward in whatever direction it wants.

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thematt
Does B&N really have those resources though? At their current burn-rate,
Microsoft gave B&N a few quarters of extra runway. It's not clear that the
underlying fundamentals have changed all that much though.

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rbanffy
So, B&N licensed Microsoft's patents for minus US$300M and a WP7 app... That's
probably the correct valuation for them.

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zargon
I don't understand the commentary about B&N possibly spinning off the
subsidiary or selling it to Microsoft. Nook is B&N's only hope of survival.

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mikexstudios
BKS stock was up close to 90% at opening and is currently up 64.84%.

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thematt
It's all a short-squeeze. Today's trading has little to do with actual
valuation.

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jbigelow76
Here's hoping I can soon run Windows 8 on my rooted Nook 2. (not holding my
breath though)

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georgespencer
Can anyone think of any compelling reasons as to why this _won't_ be another
headstone in the graveyard of average acquisitions/investments made by
Microsoft?

[http://en.wikipedia.org/wiki/List_of_mergers_and_acquisition...](http://en.wikipedia.org/wiki/List_of_mergers_and_acquisitions_by_Microsoft)

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dkrich
They have Azure to compete with AWS, and now they want to make a run at the
Kindle. Investing in B&N right now actually seems pretty smart. B&N is in need
of help, and for MSFT to start an eBook business from scratch would be very
expensive. Microsoft offers more than just software. Just like Amazon sells
the unused capacity of the servers running their own stores, Microsoft can do
the reverse, using the unused capacity sold on Azure to host their own
products. $300 million doesn't seem unreasonable for a company like Microsoft
to become a major player in the eBook market. I'm actually very happy to see
this. I don't want to see Amazon hold a monopoly on the eBook market.

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dchest
_Just like Amazon sells the unused capacity of the servers running their own
stores_

This isn't true.

[http://www.quora.com/Amazon/How-and-why-did-Amazon-get-
into-...](http://www.quora.com/Amazon/How-and-why-did-Amazon-get-into-the-
cloud-computing-business/answer/Werner-Vogels)

"The excess capacity story is a myth. It was never a matter of selling excess
capacity, actually within 2 months after launch AWS would have already burned
through the excess Amazon.com capacity. Amazon Web Services was always
considered a business by itself, with the expectation that it could even grow
as big as the Amazon.com retail operation."

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dkrich
If that's true, then it is even better for Microsoft because Amazon would
bring no competitive advantages to the fight that they could not replicate.

Not sure why anybody would view that as a plus.

