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Barnes & Noble Unveils Nook e-Reader

10/21/2009 09:27:32 AM Eastern

New York
- Barnes & Noble introduced the Nook e-reader, which may be the strongest
competitor yet to Amazon's Kindle.

The Nook includes features not offered on the Kindle, including
dual screens, Wi-Fi, a book "lending" feature and an open format. The Nook also
uses Google's Android operating system, which is expected to lead to app
downloads to the Nook in the future, said CEO of Barnesandnoble.com (BN.com)
William Lynch.

Like the Kindle and new Sony and iRex devices that are due this
holiday season, the $259 Nook offers free 3G wireless service for downloading
books over the air.

The Nook will not be available to consumer electronics retailers.
It will be sold through Barnes & Noble's 700 storefronts and at www.nook.com.

At a press event late Tuesday that included a who's who in
publishing and a brief appearance by Malcolm Gladwell, author of such books as
"Blink," and "Outliers," Lynch introduced the Nook as "the most full featured
e-reader on the market."

The Nook has a 6-inch E-Ink screen typical of other e-readers,
but it also adds a color capacitive 3.5-inch LCD touchscreen just below it,
letting users browse by swiping a finger across book cover art. Soft control
buttons and a soft keyboard are also included. The Alex
e-reader
, with a similar dual-screen platform, was just announced by Spring
Design, which said it is working with publishers and bookstores, one of whom
may offer Alex by the end of the year.

The Nook's Android platform could allow access to gaming and
other apps, said Lynch, who noted, "It's not lost on us there will be a lot of
development on Android, so we could take games and who knows what and get it on
this device."

Among the Nook's advantages over the Kindle is a book-lending
feature called "LendMe" that allows a user to email an e-book, as a loan for up
to 14 days, to a friend via PC, Mac or smartphone, using Barnes & Noble
software. During that period, the Nook owner has no access to that e-book.

Another unique feature is Wi-Fi access when visiting a Barnes
& Noble store to permit full browsing of e-books at BN.com. Users can scroll
through an entire e-book as one would browse through printed books, and users might
also receive promotions such as a free download of the first chapter of a new
book.

Also unlike the Kindle, the Nook has a MicroSD card slot to
expand its onboard 2GB of memory with an additional 16GB for storing up to
17,000 books, said Barnes & Noble.

While the Kindle uses a closed, proprietary e-book format, the Nook
joins Sony, iRex and other e-reader suppliers in supporting the open EPUB
format as well as PDF files. Users can stop reading on the Nook and resume
reading on an iPhone, Blackberry, PC or Mac at the same spot where they left
off. The Kindle supports this on an iPhone but not on the BlackBerry or desktop
PCs.

The Kindle retains its own advantages, including a family of e-readers
in different screen sizes and new international capability, longer battery life
and the ability to "read aloud" text via text-to-speech.

A recent Forrester
Research report
expects the Kindle will take a 60 percent share of the 3
million e-readers expected to sell in the U.S. this year, followed by Sony
with a 35 percent share.

Forrester analyst Sarah Rotman Epps said in a recent blog the Nook's
$259 price point "puts the Nook competing squarely with Amazon's Kindle 2 - most
likely with a razor-thin margin, if any, for B&N. To steal market share
from Amazon and make up for lost time, B&N is pricing the Nook as
aggressively as possible."

For consumer electronics retailers, the Nook, like the Kindle, represents
a double-edged sword. The NPD Group's industry analysis director Ross Rubin
noted that its "unfortunate for CE retailers" that the Nook will not be sold
through CE retailers, but he said, "Having a player with [Barnes & Noble's]
influence supporting EPUB helps the category, as well as publicizes the value of
other devices that retailers do sell."

Barnes & Noble also stated it will soon offer an e-book app
for Nokia smartphones and will offer apps in the future for Android and Window
Mobile smartphones. It already offers apps for the iPhone and Blackberry.

The company also said the first 10,000 buyers of the Nook will
receive a free download of Gladwell's new book, "The Tipping Point."