Photo: Mostly Muppet / Flickr

Microsoft Corp has sued American Book retail chain Barnes & Noble for patent infringement regarding the Android technology running in B&N’s Nook ebook reader. This, for those keeping score, is yet another Android-related lawsuit Microsoft is involved in, after suing Motorola for aspects of their Android handsets.

No, you can’t have a tab!

The patent infringement lawsuit sees the software titan accusing the Barnes & Noble Nook ebook reader of infringing several of its patents, including the software that is used for tabbing between screens, surfing the web and interacting with the ebooks themselves. In total MS alleges the B&N Nook infringes on five patents, which concern how the device displays retrieved images, the status of downloads on a small display, the editing of electronic documents, as well as how it renders notations.

You’re not alone

While Microsoft suing Barnes & Noble is undoubtedly the headline, Foxconn International Holding Ltd – who own the company that manufactures iPhones – and Inventec Corp, have also been hit with patent infringement suits.

Speaking on these patent infringement lawsuits, Microsoft’s deputy general counsel of intellectual property and licensing, Horacio Gutierrez said: ‘The Android platform infringes a number of Microsoft’s patents, and companies manufacturing and shipping Android devices must respect our intellectual property rights.’ He continued, saying: ‘We have tried for over a year to reach licensing agreements with Barnes & Noble, Foxconn and Inventec. Their refusals to take licenses leave us no choice but to bring legal action to defend our innovations.’

Order of the day in smartphones, not so much in e-readers

While lawsuits in the smartphone space are plentiful, there’s been virtually no legal activity in the ebook readers market. Given Android is predominantly a smartphone platform, we can consider the Barnes & Noble Nook suit here straddling the line somewhat.

The e-reader space is one in which Microsoft is not currently competing. And as perennial nemeses Apple and Amazon juke it out with their iBooks and Kindle platforms respectfully, Microsoft has stood to the side and, for the most part, just watched. Whether suing Barnes & Noble is a warning shot at Google, a legitimate case of patent infringement on B&N’s part, or an early sign MS is keenly looking into the space remains to be seen.

Photo: goXunuReviews / Flickr

Ebooks and e-readers have certainly crossed a notable threshold. Not only are they in the spotlight for giving Amazon a notable boost, and for their role in the decline of Barnes & Noble, it seems we (and other sites) are writing much more about them. That’s a good indicator of a trend. Now Dorchester Publishing, mass sellers of romance and crime novels, has decided to completely abandon mass printing in favour of going digital (and print-on-demand) only.

Plummeting sales to blame

Dorchester saw a 25 per cent year-on-year decline on sales of books this past June, whereas the company expects to see its eBooks sales double come 2011. Speaking to the Wall Street Journal on this seemingly extreme decision, Dochester CEO John Prebich said: ‘It wasn’t a long, drawn out decision, because we’ve been putting in the effort but not getting results’.

What of the distribution partners?

The problem with this eBooks strategy from Dorchester Publishing is what it means for its relationship with its distributors and resellers. Naturally, if they’re not selling titles in bulk, the value proposition for distributors may begin declining.

‘It’s been a good run, but if they aren’t publishing mass-market paperbacks, we’ll have to decide what to do,’ explained Charles Ardai, owner of Hard Case Crimes, a company that distributes some of Dorchester Publishing’s books, reports Ars Technica.

Massive boon for e-readers

Just like the great Newscorp pay wall experiment, many publishers, big and small, will have a keen eye on Dorchester’s success after adopting this digital-only and print-on-demand model. Simply put, the marginal waste of books that never sell is becoming too expensive to be sustainable. This problem doesn’t exist with digital books, and if the business models can be tailored to work, it stands to reason many will follow suit.

And if more publishers go eBooks exclusive, the sale of e-readers across the board – not just the Kindle – will explode.

Photo: Barnes & Noble

If, for whatever reason, you still didn’t think eBooks and e-readers were here to stay, here’s a shock to your system: Barnes & Noble Inc., the US’s biggest books retail chain, has just put itself up for sale. The real kicker is the growing sales of digital books are partly to blame.

For sale sign erected

After continued pressure from shareholder activists Barnes & Noble Inc. has put itself up for sale, as reported by the Wall Street Journal. The company announced that a continuously falling stock priced forced the group to think through all alternatives, ‘Including a potential sale’.

The primary reason for the somewhat unexpected yet not-altogether-surprising sale is the meteoric rise of digital books and their respective e-readers as a viable platform, as well as more and more book lovers ordering their titles online. This meant that foot traffic to the stores declined steadily, putting revenue pressure on the group in step. Effectively, as has been evident for years but has only really come to fore recently, Amazon has wrecked their business.

Potential buyers

With Barnes & Noble Inc. having 720 stores across the United States, 637 stores on college campuses and a grand brand name, the company is attractive to various suitors. Leonard Riggio, the group’s founder and chairman, may be forming a group of investors to purchase the company, and a multitude of private equity firms are expected to be in the running, too.

What’s the benefit?

What do potential suitors stand to gain? A fair amount, actually. The aforementioned brand pull and reach of the group is a great motivator, as is the promising Barnes & Noble Nook e-reader platform. Sure, Amazon has trail blazed ahead and has put some distance between itself and competitors, but the Barnes & Noble Nook (and the iPad) have confirmed that Amazon is not the de facto e-reader yet.
What matters in this story is that eBooks and e-readers are big, big business. Big enough, in fact, to force the hand of America’s biggest books chain.