We knew it was coming… and you know what happens to things you know are coming? They eventually come. Case in point: Amazon’s Kindle app for Windows Phone 7, first teased in October and now available to anyone with a WP7 device and a desire to read stuff. Grab it now, if you’re into that sort of thing.
Barnes & Noble has announced that its NOOK range has become the retailer’s biggest selling line in the company’s history, with the NOOKcolor taking the number one spot as the best-selling gift of the holidays. Meanwhile, almost one million B&N ebooks were purchased on Christmas Day, despite widespread reports of server issues plaguing the service for the holiday weekend.
Updated with B&N statement on the server outages after the cut
The news follows Amazon’s announcement that the Kindle is now its best-selling product of all time. Neither retailer has publicly confirmed sales figures, however, with B&N only saying that “millions” of NOOK devices – including the original NOOK, its WiFi-only version and the newest NOOKcolor – have been sold.
For more on the NOOKcolor, check out our multi-part series on a week with the new color ereader tablet. We’re chasing B&N for an official comment on the outage.
Update: Barnes & Noble spokesperson Mary Ellen Keating gave us the following brief statement:
“Due to the high traffic and customer demand on Christmas Day, we experienced some sporadic issues with our servers that were quickly resolved.”
Press Release:
NOOK™ Line of eReading Devices Becomes Barnes & Noble’s Biggest Bestseller in Its History
NOOKcolor™ is Company’s Top Holiday Gift
Millions of NOOK™ Devices and Expansive Digital Catalog Combine to Result in Nearly One Million NOOKbooks Sold on Christmas Day
New York, New York – December 30, 2010 – Barnes & Noble, Inc. (NYSE: BKS), the world’s largest bookseller, today announced that with millions of NOOK eReading devices sold, the line has become the company’s biggest bestseller ever in its nearly 40-year history. The new NOOKcolor Reader’s Tablet, introduced just eight weeks before Christmas, is the company’s number one selling gift of the holiday season. Barnes & Noble also announced that it now sells more digital books than its large and growing physical book business on BN.com, the world’s second largest online bookstore. With its growth across device and NOOKbook™ sales over the critical holiday selling season, Barnes & Noble has successfully established itself as a leader in digital reading.
Demand for the critically acclaimed NOOKcolor remained high following the product’s introduction in late October through the holidays. Sales have continued to exceed the company’s high expectations. In addition to a great customer response, NOOKcolor has received high praise and critical acclaim from leading technology and consumer media outlets including being named “Editors’ Choice” and the “Best Android Tablet of The Year.” The company also experienced robust sales for its award-winning line of NOOK 3G and Wi-Fi devices, which feature an E-Ink display and a color touchscreen for navigation.
The company also reported record holiday sales from its comprehensive two-million-title catalog, including nearly one million NOOKbooks purchased and downloaded on Christmas Day alone. Through Barnes & Noble’s eReading offerings, customers can buy and read their NOOKbooks on the widest range of platforms, including NOOKcolor, NOOK 3G, Wi-Fi®, and using NOOK apps on popular devices including iPad™, iPhone®, Android™ smartphones and more. Among the best-selling titles of the holiday season were James Patterson’s Cross Fire, Stieg Larsson’s The Girl with the Dragon Tattoo, The Confession by John Grisham, and Decision Points by former U.S. President George W. Bush.
“NOOKcolor became the gift of choice over the holidays for people who love to read everything – books, magazines, newspapers, children’s books and more – in rich, beautiful color,” said William Lynch, CEO of Barnes & Noble. “The success of NOOKcolor, along with our unique ability to market NOOK devices to readers in our stores and through our strong channel partnerships with Best Buy, Walmart and Books-a-Million, resulted in the continued explosive growth of our Digital Content business and our NOOK line, our most successful products ever. We have a large online book business at BN.com, that’s been recently growing. And the fact that eBook unit sales now exceed physical book sales through BN.com, illustrates how quickly we’ve grown this exciting new business at Barnes & Noble.”
NOOKcolor is the first full-color touch Reader’s Tablet that integrates books, magazines, newspapers and children’s books – all in amazing, rich color in a device that weighs less than a pound. It features a stunning 7-inch VividView™ Color Touchscreen and is the most social reading device ever built. NOOKcolor is available at your local Barnes & Noble store and at www.NOOKcolor.com, as well as Best Buy, Walmart and Books-A-Million stores.
Amazon has turned on Kindle ebook loans in the US, meaning readers can now share certain titles with their friends for a limited period. Announced back in October 2010, the functionality allows ebooks to be loaned to a single person for up to 14 days, though during that period the original owner will not be able to access it themselves.
Loaned ebooks can be read on Amazon’s dedicated Kindle hardware, as well as through the company’s various mobile and desktop apps for iOS, Android, Mac, PC and other platforms. The recipient receives the loan invitation by email and is required to have an Amazon account in order to access the title.
However, only certain ebooks can be loaned out, with the limitations the decision of the rights-holder or publisher. Compatible titles are marked with “Lending: Enabled” in the product description.
Apple has been accused of selling pirated ebooks by Japanese authors in its iBookstore, with titles by high-profile authors such as Haruki Murakami and Keigo Higashino among the texts. According to a consortium of Japanese publishers, “some of the works have been deleted in response to requests from authors and publishers but a majority of them continue to be illegally distributed.”
Although not detailed by reports coming out of Japan, it seems likely that the furor has been caused by self-published iBooks content. Apple opened up the iBookstore to self-publishing authors back in May 2010 via iTunes Connect, and – as Amazon has discovered with its Kindle ebook store – it makes a tempting target for unofficial copies of electronic texts.
In a statement, Apple said “We fully understand the importance of intellectual property including copyright” and promised to “promptly and appropriately respond to complaints about violation of copyright.”
The WikiLeaks Kindle ebook on Amazon UK has is prompting further controversy, with Amazon adding a statement to the product page and various reports that the author had taken the text down. However, at time of writing the ebook is still listed as available to buy, albeit with the added proviso that “This book contains commentary and analysis regarding recent WikiLeaks disclosures, not the original material disclosed via the WikiLeaks website.”
Amazon found itself in hot water earlier this week, after the ebook was spotted up for sale for its Kindle ereading platform, while its web-hosting arm AWS had closed down the official WikiLeaks account. The retailer was accused by many of hypocrisy, but has argued that the ebook does not actually contain the full leaked cables (despite the product description).
No small amount of irony today, as a Kindle version of the full WikiLeaks cables turns up on Amazon. The site content itself was yanked from the online retailer’s hosting arm last week, over allegations that the leaked cables contravene the AWS terms of service; however, as reviewers have been quick to flag up, that doesn’t stop Amazon making some money on sales of the ebook.
Ebook “author” Heinz Duthel is a prolific submitter of texts to Amazon’s Kindle store, with around three hundred titles currently coming up on an ebook search. It’s unclear how long Amazon will allow the text to remain on sale, though the retailer will likely face criticism whether it removes the WikiLeaks ebook or not.
Google has launched its play for the ebook market, in the shape of the new Google eBookstore along with ereader apps for Android and for iOS devices. Offering over 3m titles – made up of new bestsellers and free public-domain ebooks – the Google eBookstore also supports an online eBooks Web Reader, with browser-based access to a cloud-store of content.
As well as Google’s eBookstore, there’ll be content available from Powell’s, Alibris and participating members of the American Booksellers Association. Certain ebooks will support user-selectable fonts, font sizes, day/night reading modes and line spacing, with page sync across devices.
If you have a NOOK or a Sony Reader ereader, you’ll be able to transfer across your Google eBookstore purchases too, since they’re in Adobe’s eBook format. Currently the ebook service is available in the US only, though international readers can still access Google’s public-domain catalog.
Barnes & Noble has announced its latest quarterly financial results, and the retailer has its digital arm to thank for its 1-percent year-on-year sales growth. According to the results, online sales – including NOOK and ebooks – increased 59-percent over last year, whereas in-store sales decreased by 3-percent. B&N now reckons it has around 20-percent of the ebook market.
The popularity of digital devices and content – together with other recently expanded departments, such as Toys & Games which saw a 42-percent sales increase – has left Barnes & Noble confident about predicting $170m to $205m EBITDA for the full year. As for talk of selling the company, B&N’s special committee is still looking into the possibility and “meeting with both strategic and financial institutions.”
Press Release:
Barnes & Noble Reports Fiscal 2011 Second Quarter Financial Results Barnes & Noble.com Comparable Sales Increase 59% – Driven By Digital Initiatives
Barnes & Noble Launches NOOKcolor™ to Critical Acclaim
Holiday Sales Off to a Strong Start
New York, NY (November 30, 2010) – Barnes & Noble, Inc. (NYSE: BKS), the world’s largest bookseller, today reported sales and earnings for its fiscal 2011 second quarter ended October 30, 2010.
SECOND QUARTER RESULTS
Total sales for the second quarter were $1.9 billion, including sales of Barnes & Noble College Booksellers (“College”) of $798 million. Excluding College, total sales increased 1% over the prior year period. Comparable sales at Barnes & Noble.com increased 59% driven by increases in core products and sales of digital devices and digital content. Barnes & Noble comparable store sales decreased by 3.3% and College’s comparable store sales decreased by 1.5%.
The expansion of the Toys & Games department at Barnes & Noble stores produced a 42% sales increase for the department during the second quarter. In the third quarter, the company began testing additional concepts, including an expanded children’s offering and digital and electronics accessories, to drive further sales increases in 2011.
For the second quarter, the company reported earnings before interest, taxes, depreciation and amortization (EBITDA) of $46 million. The consolidated second quarter net loss was $12.6 million, or $0.22 per share, in-line with previously issued guidance of earnings of $0.05 per share to a loss of $0.25 per share.
As previously announced, the company continued to invest heavily in digital initiatives including: software and cloud services development costs; expenses relating to NOOKcolor; the addition of hundreds of thousands of titles to its digital catalog including a subscription management platform for digital newspapers and magazines; creating interactive proprietary content for children’s books; developing applications to serve multiple reading and smartphone devices – including iPad®, iPhone®, Android™ and BlackBerry®; and the rollout of NOOK Boutiques in Barnes & Noble retail stores.
The additional investments are expected to continue and peak during the second half of the year, and then increase moderately in the years ahead. Payoff for these expenses is estimated to begin to appear in the third quarter, when NOOKcolor is expected to be one of the world’s most sought after eReaders, and in the third and fourth quarters, when NOOKcolor owners will begin downloading digital content, including books and magazines.
BARNES & NOBLE LAUNCHES NOOKcolor
At the end of the second quarter, Barnes & Noble launched NOOKcolor, the first Reader’s Tablet that enables customers to purchase interactive digital content on a full color touchscreen. Concurrent with the introduction of NOOKcolor, the company introduced NOOKnewsstand™ and NOOKkids™, enabling customers to access periodicals, magazines, and interactive children’s books. Additional device features include web browsing, the ability to listen to music and much more.
NOOKcolor has received widespread critical acclaim from many technology publications, including The Wall Street Journal, which called the product “a winner.” Orders for NOOKcolor significantly exceeded the company’s expectations, and since going on sale on November 16, 2010, it has become the single bestselling product at Barnes & Noble.
“Since launching our eBookstore in the second half of last year, Barnes & Noble has quickly captured approximately 20% of the exploding eBook market. We have plans to grow our share well beyond 20%, and the early success of NOOKcolor is encouraging,” said William Lynch, chief executive officer of Barnes & Noble, Inc. “Selling digital content is becoming a big business for us that we expect to grow at exciting rates. Based upon the double-digit comparable store sales achieved over the past weekend, we are further convinced that eReaders and accessories will be a key holiday gift item and driver of holiday sales this year, leading to accelerating eContent sales in the quarters and years ahead. We’re continuing to invest in this opportunity to build the most expansive catalog of digital content available for sale, the best reading software on the market, and devices that deliver the most innovative digital reading experiences.”
GUIDANCE
Barnes & Noble.com’s comparable sales are expected to increase by approximately 75% for both the third quarter and the full year. The company believes these sales increases will be driven primarily by growing sales in core products and the exploding digital content business. By fiscal year end, the company expects that digital content sales will achieve a $400 million full-year run-rate.
Barnes & Noble comparable store sales are expected to increase between 5% and 7% for the third quarter, and to be in a range of flat to 3% for the full year. Increases in sales will be largely driven by sales of NOOK™ devices and accessories, and by increases in children’s products and other non-book merchandise.
During the three-day post-Thanksgiving weekend, the company experienced a strong comparable store sales increase of 17.2% at Barnes & Noble stores and a comparable sales increase of 105.7% online.
College’s comparable store sales are expected to be in a range of flat to a decrease of 2% for the third quarter and the full year.
The company expects to achieve EBITDA of approximately $160 to $190 million and $170 million to $205 million, for the third quarter and the full year, respectively. Third quarter earnings per share are expected to be in a range of $0.90 to $1.20. Full-year fiscal 2011 losses per share are expected to be in a range of $0.75 to $1.15.
BARNES & NOBLE DECLARES QUARTERLY DIVIDEND
The company’s Board of Directors declared a quarterly cash dividend of $0.25 per share payable on December 31, 2010 to stockholders of record on December 10, 2010. At the end of the second quarter, the company had borrowings of approximately $377 million under its $1 billion revolving credit facility. The company’s financial position remains strong and the revolving credit facility provides ample room for the company to fund its strategic investments.
UPDATE ON STRATEGIC ALTERNATIVE PROCESS
As previously announced on August 3, 2010, Barnes & Noble’s Board of Directors has created a Special Committee to review strategic alternatives, including a possible sale of the company. This review process is currently ongoing and the company is meeting with both strategic and financial institutions.
There can be no assurance that the review of strategic alternatives will result in a sale of the company or in any other transaction. There is no timetable for the review, and the company does not intend to comment further regarding the evaluation of strategic alternatives, until a specific transaction is recommended by the Special Committee or the process is concluded.
CONFERENCE CALL
A conference call with Barnes & Noble, Inc.’s senior management will be webcast beginning at 10:00 A.M. ET on Tuesday, November 30, 2010, and is accessible at www.barnesandnobleinc.com/webcasts.
Barnes & Noble, Inc. will report holiday sales on or about January 6, 2011.
Sony is having a second stab at their domestic ereader market, with the WSJ reporting that as of December 10 two models from the company’s latest line-up will go on sale in Japan. The Sony PRS-350 Pocket Edition and PRS-650 Touch Edition will be priced at around 20,000 yen and 25,000 yen ($239 and $299) respectively, and is in the midst of negotiations with Japanese publishers.
Those negotiations – blamed, in no small part, for the initial failure of Sony’s ereader push in Japan all the way back in 2004 – will include what liberties ebook readers can take in transferring titles between the two Reader models and smartphones/PCs. There are currently no plans – at least announced publicly – for the Reader Daily Edition, which is intended to receive regular periodicals via its 3G connection.
Amazon has seemingly grown bored of waiting for people to actively adopt its Kindle ereading platform, and instead wants it to be foisted on unwitting gift recipients this holiday season. As of today it’s possible to gift a Kindle ebook with nothing more than the recipient’s email address.
The lucky recipient doesn’t need to have a Kindle or one of Amazon’s Kindle apps in order to receive the gift; however, they will need to either download an app or buy the ereader if they want to redeem it and actually read the book. Admittedly that’s a free download if you have an iPad, iPod touch, iPhone, Mac, PC, or BlackBerry or Android device.
We can understand why Amazon is doing this, and if you know someone who already uses the Kindle platform then it would probably even be preferable to a physical book, but pushing (at least) a download on someone in order to enjoy a present seems a bit unnecessary come Christmas day. A bit like not including the batteries, in fact.
Press Release:
For the First Time, Give the Gift of Kindle Books (No Kindle Required)
Kindle Store the first major bookstore to offer eBook gifting
SEATTLE – Nov. 19, 2010 – (NASDAQ: AMZN) – Kindle is the most gifted item in the history of Amazon.com and millions of people around the world are reading Kindle Books on Kindle devices and free Kindle apps. Beginning today, just in time for the holiday season, customers can give Kindle Books as gifts to anyone with an e-mail address—no Kindle required. Kindle Books can be read on Kindle devices and free Kindle reading apps for iPad, iPod touch, iPhone, Mac, PC, BlackBerry and Android-based devices. For more information or to give a Kindle Book as a gift, go to www.amazon.com/givekindlebooks.
“We are thrilled to make it easier than ever for our customers to give their favorite Kindle book to a friend or family member as a gift,” said Russ Grandinetti, Vice President, Amazon Kindle. “We’re making this functionality available in time for the holidays to offer an easy, stress free holiday shopping option for anyone – not just Kindle owners.”
To give a Kindle Book as a gift, customers simply choose a book in the Kindle Store, select “Give as a Gift” and send their gift to anyone with an email address. Notifications of Kindle Books gifts are delivered instantly via e-mail and the recipient redeems the gift in the Kindle Store to read on any Kindle or free Kindle app.
Just in time for holiday gift-giving, Amazon editors’ picks for the best books of the year are:
1. “The Immortal Life of Henrietta Lacks” by Rebecca Skloot
2. “Faithful Place: A Novel” by Tana French
3. “Matterhorn: A Novel of the Vietnam War” by Karl Marlantes
4. “Unbroken: A World War II Story of Survival, Resilience, and Redemption” by Laura Hillenbrand
5. “The Warmth of Other Suns: The Epic Story of America’s Great Migration” by Isabel Wilkerson
6. “Freedom: A Novel” by Jonathan Franzen
7. “The Girl Who Kicked the Hornet’s Nest” by Stieg Larsson
8. “To the End of the Land” by David Grossman
9. “Just Kids” by Patti Smith
10. “The Big Short: Inside the Doomsday Machine” by Michael Lewis
With over 725,000 books, the U.S. Kindle Store (www.amazon.com/kindlestore) has the largest selection of the most popular books that people want to read – including New York Times Bestsellers and New Releases from $9.99. Kindle lets you Buy Once, Read Everywhere – on Kindle, Kindle 3G, Kindle DX, iPad, iPod touch, iPhone, Mac, PC, BlackBerry and Android-based devices. Amazon’s Whispersync technology syncs your place across devices, so you can pick up where you left off. With Kindle Worry-Free Archive, books you purchase from the Kindle Store are automatically backed up online in your Kindle library on Amazon where they can be re-downloaded wirelessly for free, anytime.
