Barnes & Noble announced its quarterly results yesterday and they weren’t good. Overall revenue was down. What had been a profit in the same period last year swung to a loss. And, probably most disconcerting, the Nook Media division had sales that were more than a quarter less than the previous year – this, at a time when the company’s competitors are continuing to grow quickly.
Despite it all, the company’s stock price didn’t budge. Perhaps B&N investors have Len Riggio to thank. The company’s board, of which he is the head, is currently exploring selling the retail business of nearly 700 bricks-and-mortar stores to him.
If you look at the company’s market capitalization (the number of outstanding shares multiplied by the price per share), and you compare it with the nominal valuation of the Nook business (what it is considered to be worth following investments by Microsoft and Pearson), then you’ll see a funny discrepancy. The stock market actually thinks the whole company is worth less than Microsoft and Pearson think the Nook and college bookstores segment is worth alone. Essentially, the market thinks that the retail stores are worthless. So, whatever Riggio pays for them could be considered found money.
But that’s not the most interesting thing to you in what transpired yesterday, DBW Daily readers. The most interesting thing is that the company will now be embarking on a different strategy with Nook. Two points to consider:
— B&N said it would not be discontinuing its device business. – B&N also said that it would be cutting costs in the Nook Media division. That could come in the form of layoffs, cutbacks in other kinds of investments, cutbacks in marketing and more. However, often in these kinds of situations it unfortunately means layoffs. We shall see.
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The rest of the day’s top news:
Nook Advice (The Digital Reader)
Some changes Nook should make to change its business. First among them is to close the Nook app store and, eventually, opening up its devices to the entire universe of Android apps.
Apple Rising? (DBW)
One analyst has pegged Apple’s share of the worldwide ebook market at 24%. While we think the analysis has some flaws, it’s worth taking a look at for yourself. Also, it dovetails with what we’ve been hearing on the street: that Apple is gaining market share among publishers in the U.S., mostly at the expense of Barnes & Noble.
Children’s Platform Wars: MeeGenius Adds Random House (DBW)
There’s an arms race right now in the ongoing wars between children’s book platforms: it’s a race to add more content. MeeGenius scores a hit with Random House.
Children’s Platform Wars: Storia Adds Arcturus (DBW)
Storia has a massive native advantage in this war in that the company has a huge catalog of its own content to dip into. Other platforms are building a lot of it from scratch. When Storia starts piling on the partners, it could be hard for others to compete.
Google Takes Passage to India (Medianama.com)
Forgive the reference – we couldn’t resist. The story is that the Google Play store is now selling ebooks in India.
Smithsonian Goes Digital (DBW)
Cengage will be digitizing Smithsonian content for the academic market.
More Discoverability in Libraries (DBW)
ProQuest, ebrary and others are entering into a metadata-sharing partnership aimed at helping improve book discoverability in library ebook collections.
Penguin Pulled Back in (Pub Lunch)
Penguin has settled with the U.S. DOJ in the matter of ebook price-fixing but has not yet settled with the U.S. states. Therefore, for now, Penguin has to show up at a June trial where it is still the main defendant. And the preparations start today.
More on Amazon’s Anti-Free Move (Pub Perspectives)
George Burke, CEO of eBookDaily.com, a website that points its users toward free Kindle ebooks, questions the wisdom of Amazon’s latest move. Related: Is Amazon Killing the Free Ebook?
EPUB3 Dead? (TOC)
According to Tools of Change, EPUB may already be irrelevant even as ebook retailers prepare to support its latest version, EBUB3. More likely the ebook retailers are in the drivers’ seat right now when it comes format.
Self-Publishing: What Has Changed? (Write It Forward)
For one, we don’t call it “self-publishing” so much anymore; today it’s “indie publishing.” DBW expert blogger (and hybrid author) Bob Mayer details how much has changed in the past three years in indie publishing.
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