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Microsoft pays $300m for Barnes & Noble subsidiary stake

Android lawsuit disappears overnight
Mon Apr 30 2012, 15:14

CLOSED SOURCE SOFTWARE HOUSE Microsoft has inked a deal with Barnes & Noble giving it a stake in a newly created subsidiary, ending the legal dispute between the two firms over Google's Android operating system.

Microsoft and Barnes & Noble have been in court for over a year after Microsoft sued the bookseller over its Nook tablet. Now the two firms have signed a deal that will see Barnes & Noble create an e-book subidiary, at which Microsoft will throw $300m for 17.6 per cent equity.

As Microsoft has dropped its lawsuit against Barnes & Noble, the latter was quick to promote its Nook by saying the application will be available for Windows 8. Although Microsoft didn't mention any other products or applications, by taking a sizeable chunk of equity in the new venture it is safe to say the firm will try to use it to push its Windows 8 operating system.

Andy Lees, president of Microsoft's Windows Phone division said, "Our complementary assets will accelerate e-reading innovation across a broad range of Windows devices, enabling people to not just read stories, but to be part of them." Surprising words from a company that has been suing Barnes & Noble for billions.

Microsoft said Barnes & Noble and its new subsidiary will pay a royalty licence fee to Microsoft for its Nook tablet and ebook reader, meaning the firm has signed up yet another Android device maker. However Microsoft had to pay $300m in order to avoid what could have been a damaging trial.

Barnes & Noble has yet to decide on a name for its new subsidiary but Microsoft said the deal "paves the way for both companies to collaborate", which could mean that Barnes & Noble will be putting out a Windows based tablet. µ


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