Can a Free E-Reader Save Barnes & Noble's Nook Business?

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Starting Sunday, Barnes & Noble (NYSE: BKS ) will give away one free Nook Simple Touch E Ink reader with the purchase of a Nook HD+ tablet.

This deal (which runs until March 30) is one of the more unusual sales announced by Barnes & Noble, which got into the tablet business a couple years ago to keep up with Apple (NASDAQ: AAPL ) and Amazon (NASDAQ: AMZN ).

The Nook HD+ comes in two varieties: 16GB (which retails for $269) and 32GB ($299). The Nook Simple Touch retails for $79. For those who already wanted both items, this is likely the best deal they will find.

However, one has to wonder what this means for the company, its Nook division and the entire e-reader industry. iSuppli dropped a bomb last year when it revealed a troubling trend in e-reader sales. Now Barnes & Noble is essentially trying to get rid of a device that was supposed to be one of the company's best sellers.

This is not the first sign of trouble at Barnes & Noble. In February, the company announced that Nook sales had fallen 26 percent .

The bookseller blamed the steep decline on lower device unit volume, inventory charges and higher operating expenses. At the time, Barnes & Noble said that it had implemented a cost reduction program to significantly reduce the latter, but it did not say by how much.

E-readers are not expected to sell very well during the spring months. One report claimed that Kindle shipments have plummeted this month , dropping from 420,000 units in February to an estimated 20,000 units in March.

Even so, it will be interesting to see if the free Nook Simple Touch deal can help turn the tide. After all, consumers love a good sale .

If this sale had occurred in December (or even on Black Friday) it might have made a lot of sense. However, Barnes & Noble chose to implement the sale on Sunday, March 24 -- one week before Easter. In terms of gift-giving, that holiday is typically known for eggs, candy and other simple treats -- not expensive electronics.

The holiday might not have anything to do with the sale, however. Barnes & Noble may only be reacting to the industry's changes.

At this time two years ago, e-book sales tripled year-over-year . Now that sales have tapered off not only for Barnes & Noble but the entire industry, booksellers are doing whatever they can to maintain consumer interest.

Louis Bedigian is the Senior Tech Analyst and Features Writer of Benzinga. You can reach him at 248-636-1322 or louis@benzingapro.com. Follow him @LouisBedigianBZ

(c) 2013 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Stocks

Referenced Stocks: AAPL , AMZN , BKS

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