Microsoft’s decision to invest in Barnes & Noble’s Nook has some of its loyal corporate customers wondering if the Nook might become a Windows 8 tablet that could bridge the gap between consumers and corporate IT departments. Many chief technology officers have been eagerly waiting for a Windows 8 tablet. Their employees want iPads, but the Apple products are difficult for many Windows-based IT departments to manage. Microsoft has promised Windows 8 tablets for later this year, but workers who want iPads may see Windows tablets as stodgy substitutes.
A Windows 8 Nook, on the other hand, could make an impact with consumers. Barnes & Noble already has a quarter of the e-book market, and as the nation’s largest brick-and-mortar bookseller it has significant traction with American consumers. And Microsoft seems committed to making the Nook more competitive, agreeing to pay $25 million a year for five years “for purposes of assisting NewCo (Nook) in acquiring local digital reading content and technology development.”
If more readers start buying Nooks and bringing them work, more people may start to see them as alternatives to iPads. Corporate IT managers might find a Windows 8 Nook more palatable to employees than an unknown Windows 8 tablet.
For now, Nook will continue to be an Android tablet, and the only link between Nook and Windows will be a Nook app for Windows 8. But Microsoft says Barnes & Noble will still have to pay it a royalty on every Nook sold, despite the deal announced yesterday. The companies did settle their patent litigation as part of yesterday’s deal, but apparently Microsoft did not abandon its demands for royalties. Those demands are based on Microsoft’s claim that the Android operating system infringes on some of its patents. If Barnes & Noble is not fighting for its right to sell Android tablets without paying royalties, maybe it does not intend to sell them much longer.
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