Barnes & Noble Considers Spinning Off Its Nook Unit – NYTimes.com.

It’s fascinating to watch what is happening with the large booksellers, make that the large–singular–bookseller. Borders couldn’t compete and shut their doors. Barnes and Noble is increasingly selling less and less physical books and more Nooks, toys, games, and stationary products. Now Barnes and Noble is considering spinning off the Nook business.

The question now is can Barnes and Noble continue to operate its flagship stores and still be profitable? The Nook business, while selling briskly and taking away market share from Amazon’s Kindle, is still not profitable. The option of spinning off the Nook would allow more time for it to become profitable as shareholders in the parent company are not that patient. They should be, but quarterly results trump long-term growth and profitability.

I don’t think the stores will last. I don’t know how long but it won’t last. Barnes and Noble have closed stores in the past due to rising rents, so it’s not out of the question if a larger number of stores close over the next few years.

I use Barnes and Noble as a shopping guide for new books, and to grab a tasty caffeinated beverage and pastry. I find a book, then buy it with my Nook app on my iPad. No waiting in line, and no paying full retail. Even after my 20-40% discount for being a Barnes and Noble loyalty member, it’s still cheaper to buy the Nook version. It’s worth it just to not have to stand in line, or pay sales tax.

I want the Nook to succeed and provide more competition to Amazon and Apple. However, they need to make the Nook tablet a full-blown Android tablet and not hobble it with a restrictive interface.

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