Retail
Orders for B&N’s New Nook Readers at Record High (BKS, AAPL, AMZN, GOOG, WMT, TGT)
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Barnes & Noble Inc. (NYSE: BKS) CEO William Lynch said today that orders for the company’s just introduced Nook HD and Nook HD+ devices are coming in at “the highest levels we’ve ever seen for the Nook.” In an interview with CNBC, Lynch also said that the market for tablet devices is large enough to accommodate more than one winner. B&N better hope so.
To some degree, of course, Lynch is right. Since the iPad from Apple Inc. (NASDAQ: AAPL) launched in 2009, tablets have followed from Amazon.com Inc. (NASDAQ: AMZN), whose Kindle ereader beat the iPad to market, Samsung Electronics, and others. As other tablets based on Google Inc.’s (NASDAQ: GOOG) Android operating system entered the market, competition has heated up.
Last week Pew Research released new data showing that Android-based tablets now hold 48% share compared with 52% for Apple’s iOS. Last year Apple held 81% of the market to just 15% for Android. Amazon’s Kindle Fire tablets, which use a custom version of Android, have a 21% share on their own, and Samsung owns 8% of the market.
Where the Nook tablets fit in, according to Lynch, is with readers and families. The 7-inch and 9-inch HD/HD+ tablets will sell for $199 and $269 respectively, prices are competitive with Amazon’s 7-inch Kindle Fire HD and lower than the base price of $299 for Amazon’s 8.9-inch Fire HD.
B&N can afford to take small margins on the devices because, Lynch says, Nook users purchase a lot of content. And the Nook will be available at both Wal-Mart Stores Inc. (NYSE: WMT) and Target Corp. (NYSE: TGT), unlike the Amazon devices which are no longer carried by either of the giant retailers.
B&N’s share price is up 5.9% in mid-afternoon trading at $14.15 in a 52-week range of $9.35 to $26.00.
Paul Ausick
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