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New Gossip: B&N to Spin off Nook Media

An unsubstantiated NOOK sony kobo logoand unconfirmed rumor circulated yesterday that Barnes & Noble was getting ready to spin off Nook Media. The rumor originates with a stock market news service, which reported on it behind a paywall, and it has been picked up by Benzinga.

There is absolutely no evidence to support this rumor being true, but given Barnes & Noble’s history it is not completely out of the question.

Barnes & Noble did spin off their ebook division and college bookstores in 2012, selling stakes to first Microsoft and then to Pearson. And then in 2013 rumors circulated that Len Riggio wanted to split B&N and take the retail stores as a separate company.

This split did not happen, but the rumor did turn out to be true. Riggio wanted to get rid of Nook Media and rescue the retail stores, but later cancelled his plans after Bill Lynch left his position as CEO and Riggio took control of B&N in his position as chairman of the board.

This latest rumor might be a sign that Riggio is moving forward with his plans to completely spin off Nook Media. True, there’s a lot of buzz coming out of B&N that they plan to launch a tablet this summer, and there are signs that they are making moves in to the educational market, but all of that can change in a trice if B&N found a buyer for Nook Media.

And given the ongoing downward sales spiral of B&N’s digital division, I could see why this sale would be a tempting idea.

But is this rumor true? I can’t say. It is certainly not implausible, but that’s not the same thing as being true.

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Paul April 10, 2014 um 3:47 pm

I think it would be a mistake to sell Nook Media as they should have a digital strategy as well as a print strategy, even if its just for name recognition. What they really need to do is reevaluate their entire platform and see if there are better and simpler ways to sell the content (and get rid of whatever price sucks are causing their ebooks to cost more than amazon).

Nate Hoffelder April 10, 2014 um 3:57 pm

But why does B&N’s digital strategy have to be more complicated than "sell ebooks"?

For B&N, owning Nook Media is like owning one of their publisher suppliers. It isn’t really necessary.

Paul April 10, 2014 um 4:13 pm

If you’re referring to the hardware side (excluding readers) I would agree with you. But to sell ebooks they need to offer an ebook standard and delivery service.

If they were smart they would use Apple’s ibooks (assuming Apple would let them use it). Its rather a clean XML ePub standard.

flyingtoastr April 10, 2014 um 4:59 pm

The FairPlay DRM that Apple encumbers their files with is proprietary, much like King Bezos' AZW.

Doug April 10, 2014 um 6:29 pm

Not only is FairPlay proprietary, you can only read iBooks on an iPad, an iPhone, or an iMac. At least, that was the case the last time I checked.

Nate Hoffelder April 11, 2014 um 9:07 am

Yes and no.

Now it is possible to license the tech needed to build a platform like the Nook, but in 2008 and 2009 B&N had to build it from scratch.

fjtorres April 11, 2014 um 9:17 am

Yes and no.
They bought fictionwise and its ereader format and DRM in Mar 2009.
At that point they had all the resources needed for a walled garden, given that they were going with an android-based reader.
Getting into bed with Adobe (unnecessarily) was a mistake, their first and second biggest.

Nate Hoffelder April 11, 2014 um 9:34 am

They used parts of eReader to build Nook, but they also built a lot more. Also, the older format was still actively in use as late as 2011, yes.

But that doesn’t change my point that now one can license all that tech; way back when the eReader tech had to be built from scratch, and later it was acquired by B&N.

fjtorres April 11, 2014 um 11:26 am

I wasn’t disputing that today anybody can just whip out a checkbook and get an ebookstore up in a couple months. But actually getting traction is a different story.
Back in 2009 it was the opposite: hard to get in, but a bit easier to get sales. Nook went from zero to 25% in months. Then the conspiracy kicked-in.

Doug April 10, 2014 um 6:26 pm

From what I can tell, this rumor started as nothing more than the observation that, with Liberty Media no longer holding veto power, it’s now a lot easier for B&N to spin off NOOK Media if they want to.

Paul April 10, 2014 um 9:39 pm

I’m not suggesting they use the FairPlay DRM but persuade them to let them use the ePub standard they are using. You wouldn’t need to limit books to just the iOS platform unless Apple sees licensing such a format as a problem (or more to the point, the Justice Dept considering how keen they are to watch them).

flyingtoastr April 11, 2014 um 12:57 am

Apple’s "iBooks" format is the same EPUB as everyone is using, but with a proprietary DRM wrapper encumbering the file (FairPlay). It’s the same way Amazon’s AZW format is the standard open Mobipocket but wrapped up inside a proprietary DRM layer.

There is no special format to license, it’s all just a unique DRM.

Paul April 11, 2014 um 11:35 am

That’s not as true as it could be. There’s a lot of confusion over what ePub means. At the basics its just referring to where a device can find the files in a directory. At a more complicated level we start talking about what the actual files and formats actually are, and that’s less clear.

There are currently 37 major ePub standards that publishers have to follow. In some, as a minor example, gifs are allowed but jpegs aren’t and vice versa and yet they are both meeting the ePub standard except they can’t be read on different devices. Although the Kindle standard isn’t bad its not great for scientific notation. while the Apple ePub standard is pretty flexible. As Barnes and Noble seem to be pushing the education market, having a format that is useful and cheap to publishers (whether an individual or a company), would be handy.

We’re experimenting with Atomik, that should handle a lot of this for us, but its early days yet and we’ll have to wait and see what this year’s test results produce (last year it wasn’t good enough).

(Random House and Penguin are using it to process all their books as ebooks now. Its a pretty impressive bit of technology)

Ben April 11, 2014 um 8:21 am

Spin off away…everything outside of their physical stores, B&N run them into the ground. They don’t have enough technology talents with visionary digital strategy left to make it work anymore. They are a retailer at heart, stick with what they know.

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