Barnes& Noble stated that it’s putting an end to the partnership itmade with Microsoft in 2012 after another disappointing earningsreport on Thursday. Barnes & Noble’s Nook and collegebusinesses were gathered into a division called Nook Media by thatpartnership. Microsft invested $300 million into Nook Media.
According to what the company had to say:
Thistermination will ensure that the Company continues itsrationalization of the NOOK Digital business and improves theflexibility of Barnes & Noble’s in an operational and astrategy-wise sense. This termination also means that Microsoft willnot be expected to pay for support or any other payments that arestated in the commercial agreement between these partners.Microsoft’s stake in Nook Media is being bought out by Barnes &Noble.
Atthe time of the formation of this partnership in 2012, the plan wasthat Microsoft would help with the financial aspect of Nook’sinternational enlargement and that Windows devices would be the placefor loading Nook apps and content. In this way leaving no need forMicrosoft to make its own digital content stores. There was even hearsay about Microsoft thinking of buying Barnes & Noble. When welook on two years later: The international enlargement of Nook wasnever successful and Barnes & Noble is having a hard time withits very own tablet strategy.
Now let’s come to the topicof those bad earnings: Barnes & Noble revenues decreased 2.7percent for the quarter that ended in November 1, 2014, to $1.7billion. Nook revenues — which includes devices, accessories anddigital content sales — were seen to be down a massive 41.3 percentfor the quarter, to $64 million. Retail sales, including bookstoresand BN.com, were $888 million, down 3.6 percent when compared to lastyear — a decrease which primarily ascribable to decreased sales ofNook products, leading to a comparable store sales drop of 1.5percent for the quarter, as well as store closures.