A little more than a year after forming an eBook venture with Barnes & Noble, Microsoft is reportedly seeking to buy out the venture’s digital assets to the tune of $1 billion, according to documents obtained by TechCrunch this week.
Nook Media LLC, the spinoff formed after Microsoft’s $300 million investment in April 2012, handles digital book content for Barnes & Noble’s online Nook store, the Nook eReaders and Android-based tablets, and mobile apps for third party platforms. The company’s assets also include a college textbook division with both retail and digital distribution. Microsoft is reportedly interested only in the eReader and eBook aspects of the company, leaving the academic division to Barnes & Noble.
Microsoft initially invested with Barnes & Noble in an effort to bolster eBook content for its Windows Phone and then-upcoming Windows 8 devices. It’s unclear if Microsoft’s plans for Nook Media include making its content exclusive to Windows-based devices and services.
Also mentioned in the documents obtained by TechCrunch is further confirmation that Nook Media plans to discontinue its Android-based tablet business by the end of FY 2014. After introducing the Nook eReader in 2009, Barnes & Noble expanded the brand to Android-based tablets in 2010 with the Nook Color. The line has seen mediocre sales in the face of all purpose tablets from major brands such as Samsung and Apple. Instead, the company plans to refocus its efforts as a content provider for apps on third party platforms.
Estimates in the documents, yet to be confirmed, show the Nook business with $1.215 billion in FY 2012 (end April 30, 2013) revenue for a $262 million loss. Revenue is projected to fall to $1.091 billion with a $360 million loss in FY 2013.
Neither Microsoft nor Barnes & Noble commented on the documents.