Things aren’t going too well with Barnes & Noble’s digital aspirations. The book retail giant is expected to announce that revenue from its Nook media division — which includes its Nook ereaders and HD tablets — is even lower than it was this time a year ago.
According to a report by the New York Times, when Barnes & Noble reveals its fiscal third quarter results on Thursday, it will announce that the division will have made less than the projected US$3-billion for the entire year so far. While missing one target may not signal the end of the Nook, it does suggest that the retailer’s digital strategy is not working out — leading some to suggest it will focus more on licensing and less on building gadgets in the future.
A person familiar with the company told the Times that Barnes & Noble may even consider partnerships with Samsung and Microsoft to build its tablets and ereaders in the months to come, and instead shift its strategy to rely more on content deals. It’s a difficult market — the word ‘tablet’ is still all but synonymous with the iPad, as Apple continues to dominate global sales. Samsung is catching up — together, more than half of all tablets sold worldwide are carrying a shiny apple logo or the South Korean manufacturer’s name.
The Nook just doesn’t seem to be grabbing the type of marketshare that its competitors are, even with almost identical specs and a reasonable price tag. Estimates from the International Data Corporation suggest that Barnes & Noble holiday sales fell flat — it shipped just a million devices to secure 1.9% of global tablet marketshare in the last three months of 2012, placing it in fifth place after manufacturers like Apple, Samsung, Amazon and Asus. When you compare it to the same period in 2011, the situation is even more dire: the company held 4.6% of the market then, meaning it lost 27.7% of its marketshare in a year.