Monday, August 20, 2012

Barnes and Noble, Nook and NEWCO Come to UK

How many consumers know of Barnes and Noble in the UK? True those who have been to the US may be familiar with the stores, but in the main the ‘world’s largest bookstore’ has until now operated within the US and is relatively unknown in Europe. Neither is the Nook any better known outside of the US.

So it was interesting to read that they are finally venturing outside of the US and launching their digital Nook platform and devices in the UK next month.

Then we have that very interesting developing partnership with Microsoft and the new venture currently under the wraps of the name NEWCO. This venture should take over the NOOK and campus store business from Barnes and Noble and enable that other perennial latecomer, Microsoft, to get into the ebook business – again.

The challenge is not finding UK retail partners, and money can always be spent to promote the launch but who is the consumer dealing with? Barnes and Noble, Nook or NEWCO and will they have to rebrand if NEWCO happens?

The press release was brief gave nothing but we can’t help quoting from it on the statements on the NEWCO situation and what must be the longest sentence ever written,

Such statements reflect the current views of Barnes & Noble with respect to future events, the outcome of which is subject to certain risks, including, among others, the general economic environment and consumer spending patterns, decreased consumer demand for Barnes & Noble's products, low growth or declining sales and net income due to various factors, risk that international expansion will not be successfully achieved or may be achieved later than expected, possible disruptions in Barnes & Noble's computer systems, telephone systems or supply chain, possible risks associated with data privacy, information security and intellectual property, possible work stoppages or increases in labor costs, possible increases in shipping rates or interruptions in shipping service, effects of competition, possible risks that inventory in channels of distribution may be larger than able to be sold, possible risk that returns from consumers or channels of distribution may be greater than estimated, the risk that the expected sales lift from Borders’ store closures is not achieved in whole or part, the risk that digital sales growth is less than expectations and the risk that it does not exceed the rate of investment spend, higher-than-anticipated store closing or relocation costs, higher interest rates, the performance of Barnes & Noble's online, digital and other initiatives, the performance and successful integration of acquired businesses, the success of Barnes & Noble's strategic investments, unanticipated increases in merchandise, component or occupancy costs, unanticipated adverse litigation results or effects, product and component shortages, the potential adverse impact on the business resulting from the review of a potential separation of the NOOK digital business, the risk that the transactions contemplated by the partnership with Microsoft to form Newco, including with respect to any spin-off, split-off or other disposition by Barnes & Noble of its interest in Newco, are not able to be implemented on the terms contemplated or at all, the risk that the transactions do not achieve the expected benefits for the parties. 

An interesting piece in bloomberg on the relationship and Barnes and Noble -  Barnes & Noble Investor Elation With Microsoft Deal Fades

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