Earlier this month, Microsoft settled a patent infringement suit against Barnes & Noble regarding their Nook reader’s Android underpinnings. Microsoft has taken legal action against many companies that use Android in their products, but the deal that was struck in this particular lawsuit makes it especially interesting. As part of the deal, Barnes & Noble is spinning off their Nook e-reader and college textbook business into a subsidiary company in which Microsoft will invest $300 million. This new subsidiary will also release a Nook app for Microsoft’s upcoming Windows 8 platform.
This gives Microsoft stake in the digital text book market along with Apple and Amazon (Google sells ebooks and tablets, but not textbooks) and gives Windows 8 tablets day-one access to an established ebook ecosystem. At its least, this let’s Microsoft, without relying on Amazon, remove a strong barrier to would-be Windows 8 tablet buyers who want access to ebooks but don’t want to risk investing in yet another new proprietary format. At its best, Microsoft is going to come out as an extremely strong player in the education market.
Imagine you are a new college student in your college bookstore. Your school is now offering digital versions of the majority of the books you need so a tablet seems like a no-brainer. You already have a Windows computer at home, so the integration and compatibility you’d get with a Windows RT tablet looks familiar and appealing. You know you’ll need Microsoft Word and Excel for school, but there are no Microsoft Office apps for the iPad or Kindle Fire. Maybe there’s a third-party app? You’re not sure. The iPad is a very compelling choice, especially with that retina display, but there’s no desktop iBooks app, nor are there iBooks apps for other tablets, computers, or even a litte e-ink reader. The Nook app, however, runs on just about everything out there and their Nook Study app is designed especially for working with textbooks. The Kindle Fire is cheaper and works fine for reading or watching movies, but it’s not really something you can take to class and expect to get much work done. That’s what Windows is good at, after all, getting work done. Besides, there’s a Barnes & Noble on campus that already has all the text books you need in stock.
Microsoft may have only secured a necessary component for their tablet in this deal, but with the right infrustructure and marketing push, they could have secured a ticket straight to the top of the education market. And once you realize that with that position comes bulk institutional purchases and required buys for students, that’s no small matter for a company that’s struggling to find a place in mobile computing.