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Microsoft's Nook Deal: Pushing Windows 8 Into New Realms?

This article is more than 10 years old.

One of the intriguing possibilities suggested by Microsoft's announcement this morning that it plans to invest $300 million for a 17.6% stake in Barnes & Noble's Nook business is that the company is going to push Windows 8 into some places where previous versions of the company's flagship OS previously failed to tread.

The announcement this morning said that there will be a version of the Nook reader software for Windows 8, but the more intriguing possibility is that future Nooks run on Windows 8 rather than Google's Android, which is the underlying OS on current versions of the e-book reader. Microsoft is emphasizing the touch-screen capabilities of Windows 8, and expects the software to be used on a variety of tablets. Providing an extra boost to that possibility, the company is offering a version of Windows that will run on ARM-based processors, which are commonly used for tablets, smartphones and other non-PC devices.

The deal actually ratchets up the competitive heat on two fronts: the company in not only coming after Android head on in some new markets, it's also now coming after cross-town rival Amazon in the increasingly lucrative e-reader segment.

A fascinating deal, which certainly has the market's attention Monday morning: the deal give the Barnes & Noble Nook business a post-money valuation of $1.7 billion; the total valuation for Barnes & Nobile as of Friday's close was a little shy of $800 million.

BKS this morning is up $12.66, or 92.5%, to $26.34. Among the other companies affected by the deal:

  • Amazon is down $1, or 0.4%, to $225.85.
  • Google is up 42 cents, or 0.1%, to $615.40.
  • Microsoft is up 4 cents, or 0.1%, to $32.02.