Microsoft has made a big push into ereaders today by pumping $300m into the makers of the Nook tablet - bookseller and Amazon arch-rival Barnes & Noble.
The cash will buy Microsoft a 17.5 per cent stake in a new Nook subsidiary of B&N, dubbed NewCo until a name is decided.
Redmond also announced that the Nook collaboration will develop a Nook app for Windows 8 – putting a bookstore in Metro-powered devices.
In January Barnes & Noble mulled spinning off its Android Nook biz (year-on-year sales up 70 per cent over Christmas 2011) from the bricks-and-mortar side of the biz, which has been doing less well. The cash injection from the Redmond sugardaddy can make sure that goes ahead.
As part of the deal, Microsoft has wiped away its patent disputes with the bookseller, including the lawsuit over the Nook's use of Google's mobile operating system, which got Barnes & Noble complaining to the Department of Justice in November.
B&N's letter at the time said: "Microsoft is embarking on a campaign of asserting trivial and outmoded patents against manufacturers of Android devices."
Beyond ramping up the competition in the ereader space, educational publishing could also feel the impact of the Nook and MS deal. In its statement today Microsoft specifically signalled its intentions to make sure the company capitalises on B&N's strength in college publishing. ®