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Originally Posted by boswd
I know as a Kindle fan boy nothing would make you happier...
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As a Kindle
user I don't particularly care what happens to B&N. As a smartphone and tablet owner, I'm not limited to one vendor. Nor do I necessarily view the Nook as doomed. I'm primarily noting that B&N has major financial, management and structural issues. These are not trivial, nor has pointing out their continued investment in ebooks negated any of them.
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Originally Posted by boswd
Do you think it makes alot of sense to add an additional device to their Nook line up, roll out nook study platform, being commited to software upgrades and performance improvements....
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I concur these are positive aspects, and it is plausible that the ebook business may survive. That doesn't alter the facts that B&N is in a very difficult position, that it's going to get worse, that a major investor wants to replace senior management, that they have on occasion fumbled and allowed Amazon to eat their lunch, and so forth. I.e. you list improvements to their Nook business without realizing that they are facing declining revenues, shrinking profits, a major cash crunch etc etc.
Or, as I suggested in earlier posts, it looks like if they do survive they'll be a shadow of their former self.
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Originally Posted by boswd
It's about increasing capital and making the tough decisions now and not have to end up like how Borders was a couple of years ago which was on the brink of folding for not doing something earlier.
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No, this has nothing to do with raising capital. It's about Riggio and Burkle wrestling for control of the company.
Riggio is the founder, chairman, owns around 32% and is looking for private equity partners so he can maintain control. Burkle owns 19% of the stock, hates the current management, thinks Riggio is "self-dealing" with the purchase of the college bookstore chain, and wants to get rid of the "poison pill" that prevents him from purchasing a controlling equity stake.
If B&N wants to protect its capital, they'd make a "tough decision now" and slash the dividend. If they wanted to raise capital, they'd sell off a division, or wouldn't have bought Riggio's college business, or issue more stock. This isn't about enhancing B&N's business, it's about control.
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Originally Posted by boswd
....and then decide "Oh you know what, let's scrap everything and go out of buisness"
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Obviously that's not their preferred choice or business plan. However, if same-store sales continue to tank, and the ebook business doesn't produce sufficient profits, they may well need to restructure or fold. Hence my expressions of concern.