Microsoft Mute on Nook App's Bundling With Windows 8
Microsoft on Monday declined to say whether Barnes and Noble's Nook app for Metro will be embedded into Windows 8 or Windows RT.
Earlier in the day, Microsoft announced it was investing $300 million to acquire a 17.6% stake in a new Barnes & Noble subsidiary that will include the bookseller's digital Nook and College business. Microsoft also guaranteed Barnes & Noble additional payments of $305 million over the next five years.
As part of the deal, Barnes & Noble will develop a Metro app for the Nook to run on Windows 8 and Windows RT.
What Microsoft didn't say was whether the app would be bundled with Windows 8 or Windows RT, or would be offered -- along with scores of other third-party apps -- as an optional download from the Windows Store.
"One of the first benefits for customers will be a Nook application for Windows 8," the companies said in a statement.
In a conference call with reporters and Wall Street analysts earlier Monday, neither of the two executives representing the firms -- William Lynch, CEO of Barnes & Noble, and Andy Lees, president at Microsoft -- went further than that statement when talking about the Nook app and Windows.
If Microsoft did bundle the Nook app, the move would be significant: Adding the Nook to the roster of Microsoft-made Metro apps, such as Mail, Photos and Calendar, would give the jointly-owned company an advantage over rivals like Amazon on any new Windows 8 or Windows RT tablet, desktop, notebook or ultrabook.
That advantage could pay dividends to Microsoft, since NewCo -- the temporary name for the subsidiary -- will split revenue generated by the Windows 8 Nook app between Barnes & Noble and Microsoft.
In a follow-up telephone call with Computerworld Monday, a Microsoft spokesman declined to comment on how the Nook app with be distributed. Instead, he used the same phrase that Lynch and Lees applied in the conference call to parry several questions. "We are not announcing any other details of our roadmap," the spokesman said.
That leaves everyone guessing which of two paths Microsoft will take.
If it decides not to integrate the Nook app with Windows 8 and Windows RT, Microsoft would be following in rival Apple's footsteps. Apple does not include its iBooks bookselling app with iOS for the iPhone or iPad. Users can, of course, install the free app from Apple's App Store. There is no version of iBooks for OS X, Apple's desktop operating system.
The alternative would be to mimic Internet Explorer's place within Windows by including the Nook app with the new operating systems, making the e-bookstore app the platforms' default outlet for digital books, magazines and newspapers.
Microsoft continues to package IE with Windows, something that has gotten it into hot water with antitrust regulators. In the 1990s, Microsoft faced off against the U.S. government in a landmark case, which initially revolved around IE's integration. More than a decade later, European Union officials forced Microsoft to give EU citizens a way to choose a different browser.
Amazon has already created a Metro Kindle app for Windows 8 and Windows RT.
Michael Cherry, an analyst with Directions on Microsoft, believes that Microsoft will not bundle the Nook app with Windows 8 or Windows RT, but not because of antitrust fears. "The toughest thing facing Windows 8 [and Windows RT] is a lack of apps," said Cherry. "They're betting that people will write Metro [apps]...and Microsoft will want to present a level playing field."
Not for customers, perhaps, but certainly for developers.
Next page: Analyst predicts Microsoft won't embed the Nook app
Cherry argued that by embedding the Nook app in Windows 8 and Windows RT, Microsoft would send the wrong message to developers, that the playing field is, in fact, not level.
Cherry admitted to buying digital books from a trio of outlets -- Amazon's Kindle store, Apple's iBooks store and the one operated by the Canadian company Kobo -- and often shopped for the best price on each. "It's important that Windows 8 have all the [e-book stores] from the beginning," said Cherry, arguing that because e-reading is one of the prime uses of tablets, anything else would be seen as a weakness when Microsoft is playing catch-up with Amazon and Apple.
Amazon and Kobo each have already created a Metro app for Windows 8 and Windows RT; the programs are currently available in the beta of the Windows Store. There's nothing preventing them from pulling out, however, if they saw that the Nook was pre-loaded in Windows 8 and Windows RT.
The next major milestone for Windows 8, dubbed Windows 8 Release Preview, may answer questions about the Nook app's place in the ecosystem. The Release Preview will debut the first week of June.
Barnes & Noble's filing yesterday with the U.S. Securities and Exchange Commission (SEC) revealed a few more tidbits about the Windows 8 angle to the deal. Although in one section of the filing, Barnes & Noble said NewCo would develop "a Windows 8 application for e-reading and digital content purchases," elsewhere the singular "application" morphed to the plural.
"NewCo will develop certain applications [emphasis added] for Windows 8 for purchasing and consumption of digital reading content," the Form 8-K stated.
The filing also hinted at other NewCo projects. "NewCo and Microsoft would share in the revenues...from digital content purchased from NewCo...through certain Microsoft products and services that may be developed in the future and are designed to interact with the NewCo online bookstore," the submission said.
Yesterday, other analysts speculated on the chance that the joint venture will lead to Nook tablets and e-readers powered by Windows or Windows RT. Like the Kindle Fire, the Nook Tablet runs a customized version of Google's Android operating system.
Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld. Follow Gregg on Twitter at @gkeizer, on Google+ or subscribe to Gregg's RSS feed. His email address is email@example.com.
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