Microsoft Invests $300M in New Nook Subsidiary

Could the Barnes and Noble Nook  soon be getting a massive upgrade? That’s still up for debate, but it sure has gotten a huge financial boost, thanks to Microsoft.

According to the L.A. Times, Microsoft, which has stayed out of the e-reader business until now, is now giving Barnes and Noble $300 million for its new Nook-led subsidiary. As previously reported, the new branch of Barnes and Noble is something the company’s been considering for the past few months.

The subsidiary, which would act as an entirely separate Nook-led branch under B&N’s umbrella, has the temporary name Newco. Microsoft will get a 17.6 shares in the spinoff. As Carolyn Kellogg points out, however, it’s odd that Barnes and Noble chose Microsoft — of all companies — to help them out.

Microsoft’s investment was, at least by most in publishing, unexpected. Last we heard, Microsoft was suing Barnes & Noble over alleged patent infringements related to the Nook, which could have blocked importation to the U.S. after its offshore manufacture. As part of the new Nook deal, Microsoft and Barnes & Noble announced settlement of the patent suit.

Now that the two companies have kissed and made up, some are wondering what advancements could be made to the second-place e-reader — behind Amazon’s Kindle — with all that extra money.

So I ask you, fellow Nook users, what kind of improvements would you like to see? How do you think Microsoft could change the future of Barnes and Noble, if at all?

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