Print 12 comment(s) - last by marvdmartian.. on Mar 4 at 9:57 AM

Nook can't keep up with the competition

Barnes & Noble suffered a sizable loss in the third quarter due to a sales drop in its Nook and e-books business.

Barnes & Noble reported a net loss of $6.1 million (18 cents per share) compared to its profit of $52 million (71 cents per share) in the year-ago quarter. Revenue was also down 10.3 percent to $2.23 billion, which was a shortfall from analyst expectations of $2.4 billion.

The book company also saw a 2.2 percent slip in sales at namesake book superstores and 5.2 percent sales decrease at college bookstores.

One of Barnes & Noble's biggest issues was Nook and its e-bookstore. Nook revenue, which includes devices and e-books, saw a 25.9 percent decrease to $316 million in Q3 2012. This is likely due to the fact that rivals like Amazon, Apple and Google are selling tablets with greater features for low prices. For instance, Google's Nexus 7 tablet is only $200 for greater specs and features than the Nook tablets, and tech giants like Apple have e-bookstores of their own along with the more popular iPad.

Nook HD+

“In terms of the NOOK Media business, we’ve taken significant actions to begin to right size our cost structure in the NOOK segment, while also taking a large markdown on NOOK devices in order to enhance our ability to achieve our estimated sales plans in subsequent quarters,” said William Lynch, Chief Executive Officer of Barnes & Noble. 

“NOOK Media has been financing itself since October of 2012 due to the strong investment partners we've been able to attract in Microsoft and Pearson. Coming off the holiday shortfall, we're in the process of making some adjustments to our strategy as we continue to pursue the exciting growth opportunities ahead for us in the consumer and digital education content markets. Without question, our bookstores have made a significant contribution to NOOK’s success over the past three years.  And, in turn, our award-winning line of NOOK products have proven to be a strong driver of traffic to our stores.”

Analysts believe Barnes & Noble will have to divide the company at some point, considering chairman Leonard Riggio is looking to buy the bookstore sector (yet isn't interested in the Nook, e-books or college bookstore businesses).

Source: Barnes & Noble

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Too expensive
By Saldrin on 3/1/2013 6:23:34 AM , Rating: 4
My reluctance to get into the e-readers is ebooks are way too expensive. When I get get a physical copy for $7.99 why is the ebook also $7.99? I can copy/paste that file for free a million times at no expense. For some of the hard to find Sci-Fi ebooks, I'm looking at $14-20 for ebook , when again I can find the physical book for $7.99. Toss the price of the hardware involved, and it doesn't make sense.

I understand pay the author(s), and I'm all for that as I like reading books, but the pricing for the product has to be relative to what is being sold. Same goes for MP3s, digital distribution of video games and movies. There is no physical production, no DVD, no art work, no physical distribution, shelf space, salesmen....But the prices are the same? And don't get me started on DRM!

RE: Too expensive
By Paj on 3/1/2013 8:08:14 AM , Rating: 2
Thats weird, for me its often the opposite. Every Kindle version of books I buy is cheaper than the print version. Its great!

RE: Too expensive
By Mitch101 on 3/1/2013 1:31:08 PM , Rating: 2
Buy used books Amazon has a link for those too.

RE: Too expensive
By Dr. Kenneth Noisewater on 3/2/2013 8:35:31 PM , Rating: 2
Kindle also offers self-publishing and pricing for independent authors, and some of those scifi books can be fairly entertaining (if poorly edited or proofread :))

RE: Too expensive
By Chadder007 on 3/1/2013 9:07:29 AM , Rating: 2
I'm in total agreement. I would much rather have the paper in hand for the same price.

RE: Too expensive
By NellyFromMA on 3/1/2013 3:46:15 PM , Rating: 1
Actually, no, a business doesn't really have to charge based on what production costs them.

The Nook wouldn't be succesful if it costed them more to distribute the digital copy. It's price poitn, period.

Yourpoint of file transferring being a skill you know about and therefor anything dealing with that should be cheap doesn't make a whole lot of sense in economics.

In the digital age, people WILL profit and it won't necessarily be tethered to their production costs until someone undercuts them. That's when prices go down. Not when production becomes cheaper.

RE: Too expensive
By Pirks on 3/1/2013 11:12:05 PM , Rating: 2
Same here, got 96 issues of Walking Dead comics in softcover from Amazon, while e-book version at the ComiXology e-store on my Surface RT costs the same price for just 20 issues. So 96 paperback issues or just 20 issues in e-book format for the same price? Tough question! :)

RE: Too expensive
By marvdmartian on 3/4/2013 9:57:24 AM , Rating: 2
For me, the e-book option is nice for traveling, where I can bring along a 1 pound Kindle Fire (8.9" HD), that takes up very little room, versus a similar (or higher) weight of paperbacks, that take up more room. When using a Kindle Fire (or equivalent), you also have more capabilities than you'll get with a regular book (internet, gaming, etc).

However, my Kindle in no way replaces my books at home, as I still prefer a bound book, with real pages. Besides, who wants to take the chance of dropping your e-book into the toilet?? ;)

The solution is simple
By bug77 on 3/1/2013 5:58:23 AM , Rating: 2
I'm still waiting for a nice 10" reader. If they can make such a thing, I'll buy one and all of their problems will be a thing of the past.

RE: The solution is simple
By luv2liv on 3/1/2013 9:34:17 AM , Rating: 2
i have the Kindle DX and love it. but it seems 10 inch is not what the market wants so amazon doesnt have it anymore

No Surprise
By MWink on 3/1/2013 10:58:43 AM , Rating: 2
It's no surprise to me that the Nook is losing to the competition. I've worked with a Nook HD+ and a Kindle Fire (2nd generation, NOT HD) and in many ways I think the Kindle is better. I'm not comparing them directly because one is a lower end 7" tablet and the other is a higher end 9" tablet.

Really the only things I like more about the Nook HD+ are the fantastic screen, the larger size, the lighter feel (relatively speaking), and the micro SD slot. The Kindle has a far more solid feel, a vastly superior native app store (though neither compare to Google Play), excellent Amazon integration, and a good default browser (I find Silk works better for me than most other Android web browsers including Dolphin, Opera, and Firefox).

I really hate that both devices try to lock you to their own app store. I wouldn't even bother with the Nook unless you plan to root/rom it. The Kindle at least has some decent offerings in their walled garden.

The last point I want to make is the Nook HD+ just feels flimsy. It feels like it's going to fall apart in my hands. I can't imagine it standing up to even mild abuse. The Kindle however feels solid.

By Wolfpup on 3/1/2013 9:06:33 PM , Rating: 2
I prefer Barnes & Noble's DRM to Amazon's...Amazon is activation only. B&N's can actually be used in any program that support that encryption, with no activation (I've tried, it works, just a username and password).

BUT...the Nook hardware is horrible. I want hardware buttons, and while technically the Nook 2/touch/whatever has them, they're so awful as to be basically worthless. It also doesn't (and can't be set) to 'flash' on page's annoying not having visual feedback like that.

There's also no 9.7" version, just 6.

“And I don't know why [Apple is] acting like it’s superior. I don't even get it. What are they trying to say?” -- Bill Gates on the Mac ads
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