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Barnes & Noble waves the white flag and changes NOOK hardware plans

News by Andrew Kameka on Tuesday June 25, 2013.

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Barnes & Noble NOOK HD and HD+
Barnes & Noble NOOK HD and HD+

Barnes & Noble is best known as a book retailer and manufacturer of its NOOK line of ereaders and color tablets, but the company today announced that it will be just a book retailer and tablet designer after financial losses have led to the shutdown of its NOOK HD tablet unit. In its financial report for the fiscal year of 2013, Barnes & Noble revealed that the NOOK unit saw a 16.8 percent decline in revenue compared to results from the previous year. With the decrease reaching 34 percent in the most recent quarter, the company ultimately decided that its best option was "limiting risks associated with manufacturing."

The new plan is for Barnes & Noble to continue manufacturing the NOOK Simple Touch and NOOK Glowlight devices on its own. The Android-powered NOOK HD and NOOK HD+ tablets will no longer be built by Barnes & Noble. The company plans to exhaust its existing supply of tablets and then design tablets that will be built by another company. It will continue to offer software updates to existing users and expand the digital arm of NOOK Apps and ebooks.

Barnes & Noble isn't abandoning the tablet market all together, but it will no longer be a direct competitor. After getting off to an early success with its NOOK products, the company has struggled to foster growth after mounting competition from Amazon, Apple, and Samsung. CEO William Lynch issued the following statement to explain the course change:

"We are taking big steps to reduce the losses in the NOOK segment, as we move to a partner-centric model in tablets and reduce overhead costs. We plan to continue to innovate in the single purpose black-and-white eReader category, and the underpinning of our strategy remains the same today as it has since we first entered the digital market, which is to offer customers any digital book, magazine or newspaper, on any device."

source: Barnes & Noble

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Andrew Kameka
Andrew is based in Miami, Florida.

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