Rumor: Microsoft Could Buy Nook

According to TechCrunch, Microsoft is in talks with Barnes & Noble to buy Nook’s digital assets. The report suggests Microsoft isn’t interest in Nook e-reader hardware, but rather in its content distribution capabilities.

TechCrunch’s Eric Eldon and Ingrid Lunden wrote, “Microsoft is offering to pay $1 billion to buy the digital assets of Nook Media LLC, the digital book and college book joint venture with Barnes & Noble and other investors, according to internal documents we’ve obtained. In this plan, Microsoft would redeem preferred units in Nook Media, which also includes a college book division, leaving it with the digital operation — e-books, as well as Nook e-readers and tablets. The documents also reveal that Nook Media plans to discontinue its Android-based tablet business by the end of its 2014 fiscal year as it transitions to a model where Nook content is distributed through apps on ‘third-party partner’ devices.”

Michael J. De La Merced with The New York Times noted, “Shares of Barnes & Noble skyrocketed in early trading on Thursday after a report said Microsoft was offering $1 billion for the digital assets of the bookseller’s e-reader business. In morning trading, shares of Barnes & Noble were up 18 percent, at $20.99.”

Ars Technica’s Casey Johnston recalled, “Microsoft bought a 17.6 percent stake in Nook for $300 million almost exactly a year ago, when the digital Nook division split off from Barnes and Noble proper, resulting in a Nook app for Windows 8. Since then, British publishing company Pearson has purchased a 5 percent stake for $89.5 million.”

PCWorld quoted NPD analyst Stephen Baker, who said, “It appears that Microsoft [with its rumored Nook buy] is looking for a content partner brand that they can use to help develop content opportunities beyond the movies and music they provide today through Xbox Live.”