What happens to Nook?

1554 Views 22 Replies 15 Participants Last post by Strayer, Jan 14, 2013

H.M. Ward

Discussion Starter · Jan 13, 2013

Anyone wondering what will happen to Nook if/when B&N goes belly up? I'm wondering if we'll get paid or if that money will go down with the ship? All the news about them recently reminds me of the Borders collapse.

1 - 20 of 23 Posts

CMTheAuthor

· #2 · Jan 13, 2013

It ultimately comes down to if they file for bankruptcy, how they handle said filing of bankruptcy if they do, and how they handle their buyout if they don't. (I can all but guarantee someone will buy them out if they are going down.)

If they file for bankruptcy, ideally there will be a settlement to make sure any author money in their system gets handed out to the proper people. Of course, it could get lost in legal snafus, meaning this payout could take months, if not years, to work its way out.

If they get bought out, that company will take care of handling the bills, regardless of if they liquidate the company assets or keep running them in some form. (It will probably be a combination of the two.) How that would work out...only time can tell.

H.M. Ward

Discussion Starter · #3 · Jan 13, 2013

Nook isn't separate from B&N, is it?

60865

· #4 · Jan 13, 2013

Even if the brick and mortar stores vanish it is possible that nook will survive.
The question I have is what will happen if nook closes, what about all those readers that have purchased books, will they be able to keep their electronic library?

CMTheAuthor

· #5 · Jan 13, 2013

It's partially separate. The Nook is currently handled by a subsidiary partnership deal between Barnes & Noble and Microsoft. Since I don't know the exact terms of the deal, I can't be certain what will happen to the Nook if B&N goes over (although this looks like it puts Microsoft as a front runner to buy them out, given how matters stand).

B. Justin Shier

· #6 · Jan 13, 2013

The Nook division is in a seperate LLC which has been invested in by both Microsoft and Pearson. The question is not whether Nook will survive but which parties will own it.

B.

heavycat

· #7 · Jan 13, 2013

I think its incredible that they haven't taken advantage of any of their opportunities with all the new interest in ebooks. Books are their whole business. You can't say that about any of their other competitors.

People make millions to run this company. What is the deal?

sbaum4853

· #8 · Jan 13, 2013

The Nook will survive, but the important part of the original question is: will we get paid what's owed us? That's a different question, because Pubit is a Barnes & Noble program. In a bankruptcy, creditors get lined up. Our Net 60 terms with Barnes & Noble (or Smashwords's Net 60 terms with them if you use Smashwords) make us creditors. If there's a bankruptcy, by definition, that means the company can't pay its bills. We, as well as everyone else that B&N owes money to, would get put in a pool and would get the same percentage of what can be paid after liquidation. If they can pay 50% of their bills, we'd get 50% of what's owed.

But I don't think that's coming. B&N is shrinking and they have to close stores. But they might hold the company together yet. And even if they don't, they might spin off Pubit and bn.com to protect them, just as they did with Nook.

See less See more

B. Justin Shier

· #9 · Jan 13, 2013

Heavy, They are a brick and mortar retailer with tons of expensive leases and human overhead. They just survived one of the worst American recessions in decades, one that swallowed their competitor Borders whole. In the middle of this catastrophe, and while under intense competitive pressure from Amazon, they still managed to release award-winning eInk readers and LCD tablets despite having no history of designing electronic devices. Yes, their website is horrific, but they've still managed to grab approx. 20% of the US eReading market. The same cannot be said for Apple or Kobo or Sony.

I'm not happy with where B&N is, I think they could have done a better job anticipating the rise of eReading, but I can appreciate the many challenges their leaders are facing.

B.

Becca Mills

· #10 · Jan 14, 2013

B. Justin Shier said:
Heavy, They are a brick and mortar retailer with tons of expensive leases and human overhead. They just survived one of the worst American recessions in decades, one that swallowed their competitor Borders whole. In the middle of this catastrophe, and while under intense competitive pressure from Amazon, they still managed to release award-winning eInk readers and LCD tablets despite having no history of designing electronic devices. Yes, their website is horrific, but they've still managed to grab approx. 20% of the US eReading market. The same cannot be said for Apple or Kobo or Sony.

I'm not happy with where B&N is, I think they could have done a better job anticipating the rise of eReading, but I can appreciate the many challenges their leaders are facing.

B.

They have proven far more prescient and flexible, as a corporate culture, than just about anyone else involved in the traditional book business. Diversifying into the more stable university bookstore business is another smart effort they've made, for instance. It's just not going to be enough, I don't think -- not when they're competing with an entity that has, you know, basically no weaknesses whatsoever. If I even told you how many of my students buy their textbooks from Amazon instead of the beautiful Barnes & Noble university bookstore we have ...

Speaker-To-Animals

· #11 · Jan 14, 2013

My understanding is the Nook has been spun off into a separate corporation.

pjmorse

· #12 · Jan 14, 2013

Becca Mills said:
Diversifying into the more stable university bookstore business is another smart effort they've made, for instance.

I noticed that B&N was becoming the university bookstore of choice. It's not a bad idea. But I'm impressed that they've made it through the recession this far. I actually like my Nook! I'm surprised more people don't have them, but Amazon's brand recognition is ridiculously good.

G

· #13 · Jan 14, 2013

In the traditional publishing world, an agent can get an escrow clause inserted into the contract.
This means that the publisher can not mix royalty money with his operating funds. Royalties are held in trust for the author.

In the eBook world, such an escrow clause is practically non-existent.

Without such protection, authors must wait in line with other other suppliers owed money. When the money runs out, it runs out.

We indies really don't have much protection.

WilliamEsmont

· #14 · Jan 14, 2013

It wouldn't surprise me a bit if MS stepped in and bought up the Nook assets in the event of a total collapse. They don't have any real presence in the eBook space now and it would be a cheap way in. In fact, they may already have language in their partnership agreement that gives them first rights of refusal (or something similar) in the event of a bankruptcy. Say what you want about Microsoft, they have good lawyers. As for the rest of BN? Who knows..

Lisa Grace

· #15 · Jan 14, 2013

I'm not so sure the Nook, the device, will survive. If it's not a money maker, why would it? However, are Nook libraries on a cloud? If so any device can be programmed to read them, so whatever ereader system the new owners go with could be "told" to read the books.

CMTheAuthor

· #16 · Jan 14, 2013

Nook, like the majority of e-reader devices, uses the EPUB format. Most such devices can read it, along with just about any computer with the right software.

Lisa Grace

· #17 · Jan 14, 2013

CMTheAuthor said:
Nook, like the majority of e-reader devices, uses the EPUB format. Most such devices can read it, along with just about any computer with the right software.

B&N has DRM, so no, you can't just read your Nook books on another device easily. This is one reason why Amazon is beating them because Amazon provides the free Kindle App for just about any device.

WilliamEsmont

· #18 · Jan 14, 2013

LisaGraceBooks said:
B&N has DRM, so no, you can't just read your Nook books on another device easily. This is one reason why Amazon is beating them because Amazon provides the free Kindle App for just about any device.

Amazon is beating B&N for a lot of reasons, but availability of an app is not among them.

Android

PC
Mac

They also have versions for the web and for Windows 8 tablets.

Also, the choice of whether or not to employ DRM on Nook titles is entirely up to the publisher.

* This is a screenshot from the Nook dashboard.

See less See more

jlmarten

· #19 · Jan 14, 2013

I think the jury is still out as to whether or not B&N can survive, and for how long. And, as far as I know, other entities have bought an interest in B&N and the Nook, but as for that saving the company, who knows. An independent analysis of their balance sheet was done last year at this time, the results revealing a rather dire status.

When a company the size of B&N goes under, filing for bankruptcy protection, not all creditors (as someone pointed out earlier, that is what their authors are) are treated the same. Certain creditors are given preferential treatment and, I can just about guarantee you, self-pubbed authors won't be among them. While some may be given 50% of what is owed, others will walk away with much less, if anything. Fortunately for most of the authors who frequent this forum, it looks like the majority of their sales come from somewhere other than B&N.

See less See more

Cherise

· #20 · Jan 14, 2013

sbaum4853 said:
The Nook will survive, but the important part of the original question is: will we get paid what's owed us? That's a different question, because Pubit is a Barnes & Noble program. In a bankruptcy, creditors get lined up. Our Net 60 terms with Barnes & Noble (or Smashwords's Net 60 terms with them if you use Smashwords) make us creditors. If there's a bankruptcy, by definition, that means the company can't pay its bills. We, as well as everyone else that B&N owes money to, would get put in a pool and would get the same percentage of what can be paid after liquidation. If they can pay 50% of their bills, we'd get 50% of what's owed.

I think this is an important point that bears repeating.

1 - 20 of 23 Posts

This is an older thread, you may not receive a response, and could be reviving an old thread. Please consider creating a new thread.