While Barnes & Noble has created lots of buzz and headlines with its Nook e-reading devices, its future profitability lies in the sale of content. That was the message CEO William Lynch delivered to analysts last week in a conference call discussing first-quarter results. Improved gross margins were due to increased sales of higher-margin content, while competition forced B&N to lower the price of its e-reading devices by an average of 23% compared to a year ago, which contributed to a decline in device sales. Lynch said that while B&N needs to be “competitive” in the device space, “hardware is not where margins reside—they reside in digital content.” Digital content sales rose 46% in the first quarter, with sales of apps, magazines, and newspapers growing at a slightly faster pace than ebooks, Lynch noted. Continue reading at 'Publishers Weekly'
[ Publishers Weekly | 2012-08-24 00:00:00 UTC ]