Barnes & Noble’s reported recently that sales of its popular line of tablets and e-readers have plummeted in the bookseller’s fiscal 2013 first quarter ending July 28th. But it wasn’t all bad news for the giant book retailer, because digital content sales actually rose 46%, which was just enough to compensate for the loss.
In total, profits reaped from the entire Barnes & Noble Nook niche (which includes the devices, digital content, accessories and other hardware) equaled $192 million. The total revenue surpassed last years number by one million dollars.
The decline in sales numbers when it comes to Barnes & Noble’s devices probably has to do with the fact that they were forced to slash their prices this summer. For example. The 8GB Nook Tablet went from $199 to $179, the 16GB edition went from $249 to $149 and the Nook Color went from $169 to $149.
The price cuts were rumored to have been in response to a number of factors. First, the skyrocketing success of the Google Nexus 7 tablet which debuted this summer and shortly after, received raving reviews. Second, the launch of Amazon’s Kindle Fire 2 http://kindle-fire-2-news.blogspot.com/, which is scheduled for less than a month from now, and third, the buzz around the gossiped-about iPad mini http://www.techradar.com/us/news/mobile-computing/tablets/ipad-mini-release-date-news-and-rumours-1076821
This is not the first time that device-sales suffered. They weren’t up-to-par last fiscal quarter, either, and Barnes & Noble had to lower the prices of its gadgets to compete with contenders like Amazon. Last holiday season, in fact, sales were so crummy that the company had to buy back some of its inventory. Bah Humbug! To make matters worse, e-reader returns were at an astronomical level during the same time.
On a side note, in case you haven’t heard, Barnes & Noble has a whole new company in-the-works, aptly named Newco. The venture is courtesy of a $300 million investment from Microsoft. In relation to the endeavor, the bookseller stated, “The company continues to be actively engaged in the formation of Newco and is in the process of implementing the work necessary to complete the Microsoft transaction , [which is expected to] close this Fall.”
In international news regarding B&N, the company plans on bringing its Nook e-book store to the UK later this Fall. As stated in this article on mashable.com, Barnes & Noble CEO William Lynch reported, “We’re confident our award-winning technology, combined with our expansive content – including books, children’s books, magazines, apps, movies and more – will bring UK customers the option they’ve been waiting for.” http://mashable.com/2012/08/20/nook-coming-uk-autumn/