Microsoft announced on Monday that it was investing $300 million in a partnership with Barnes & Noble to form a subsidiary dubbed "NewCo." The venture will house the bookseller's Nook products and higher-education business, and Barnes & Noble will reproduce the Nook's e-reader application and bookstore for Windows 8. Additionally, industry watchers speculate that in the next iteration of the Nook Tablet, Barnes & Noble will ditch its heavily modified version of the Android operating system in favor of Microsoft's highly-praised Windows 8 OS, a move that would further differentiate the 7-inch tablet from its primary competitor, Amazon's market-leading Kindle Fire. Could a $200, Windows-powered Nook Tablet be in the cards?
Don't hold your breath: Bringing Windows 8's beautifully designed interface to an underpowered 7-inch device won't be easy, says Jason Perlow at ZDNet. For starters, it would be difficult to retool and license Windows 8 while still selling the Nook at $199. More likely: The Nook Tablet will get "Apollo," the codename for the Windows Phone OS due out later this year, which isn't quite Windows 8. Maybe such a scaled-down slab could compete with the Kindle Fire, but even then, "we are probably looking at a six-to-eight-month, product-development-to-launch timeframe, at the bare minimum." Temper expectations accordingly.
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E-textbooks might force a Windows 8 tablet: Barnes & Noble's textbooks "aren't available for purchase on the Nook Color and Nook Tablet," says Jared Spurlock at Yahoo News, largely because the device's 7-inch screen "isn't conducive to reading full-sized college textbooks." But with the education business driving Microsoft's investment, and with Windows 8 meant for a 10-inch screen, it seems plausible that we'll see an iPad-sized Nook Tablet running Windows 8.
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Regardless, rivals should worry: A Windows-powered Nook could turn the market upside down, and that's why this deal "ratchets up the competitive heat" on two fronts, says Eric Savitz at Forbes. First, Microsoft is coming after Google's Android, potentially pushing the operating system off the Nook entirely. And second, the company is targeting its "cross-town rival Amazon," setting its sights on the "increasingly lucrative e-reader segment." No matter what it does, Microsoft now has the market's attention.
Microsoft's Nook deal: Pushing Windows 8 into new realms?