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Forrester Research Principal Analyst James McQuivey on how a Microsoft and Barnes and Noble deal with the Nook will compete against the Amazon Kindle ...
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You very much so you heard this big news Microsoft investing 300 million dollars in Barnes and Noble's nook reader but this next analyst we have says that the deal was merely a life raft.
For the sinking bookstore -- -- Is our president negativity expert on -- Kids principal analyst at Forrester Research you know I -- -- -- news this morning and I thought yeah that's interesting to meet somebody woke them up but is it too little too late.
As apple and Amazon are crushing it out there with the Kindle fire -- not -- Yeah that's a problem that we're facing right now.
We're looking at a market where both -- -- apple and Amazon are juggernaut you can't really stop them in their tracks and so what do you do well you've got to try to join them.
Microsoft two years late into the tablet business Barnes & Noble -- actually really good -- of their assets it has but the assets aren't enough and so they're gonna pull their resources and see what they can figure out together.
Okay but but investors aren't stupid and they really punch Barnes & Noble up hired must think that it -- and -- getting a great part of this deal.
They do think that but of course Barnes & -- is coming from very low place to Begin with but let's be honest Nolan wouldn't value this new -- which they're calling it for now in code language.
In until they figure in the moment -- -- this is a device company isn't -- this isn't about selling books.
It's about a new -- device I'm convinced that's what this is about it's what both companies need to do next in order to get beyond the barriers to facing right now.
Amazon that has some impressive numbers when it comes to top sellers they have the exclusivity of some ten.
Out of the 100 top sellers so you kinda have to go to the Kindle fire for that.
What it David -- and I both bought Kindle fires precisely because of that issue even though we have the -- But I mean the note being -- sort of number three player whats it gonna take to get people out there.
Like David -- to say oh now I have to add this because Microsoft somehow involved.
That's exactly the problem is that if you try to position this as a book reading platform the answer will be you know what that 25 million people in the US who already read two books a month already have a platform locked in.
And that's a challenge so they've got to go into a group of people who aren't just book readers -- doing a whole bunch more things and that means you need a different device platform.
That's why this device whatever it is and whenever it comes out hopefully this year it'll be desperately too late.
Will be a device that won't just be about books it might actually incorporate deal -- resources and from Microsoft's Xbox and our north failed as a music service and -- -- -- video on demand service.
But if you are combine that together may -- you have a media play -- almost like iTunes.
Almost.
If you already have hundreds want to all right let me just say this.
Barnes & Noble.
Known to many people as a brick and mortar story does this signal the death knell of that.
The one that was huge in my neighborhood and Edgewater New Jersey.
Shut down summarily and and we -- -- devastated because what you know borders had already closed is this the end of their we have mortar source.
It's certainly not the end of it today but look at those stores are gonna get cut in half in some way -- they're gonna get smaller they gonna disappear but half of them are probably gonna go in the next couple of years in a Barnes & Noble basically has only that story to tell for the next 23 years.
Then there is no story that's -- -- gonna tell a story about you know.
Don't look at the closing stores behind the curtain keep your eyes focused on this wonderful yellow brick road and emerald city this leading us to.
We are shiny object in the right part of your eyesight thank you James -- is good to see it James -- obvious.
Forrester Research principal analyst just to tell you -- Amazon up 17%.
Year over year apple up 67%.
Barnes & Noble up 89%.
Over just the past three months.
