B&N has been trying hard to compete with Amazon Kindle. The Kindle got to an early start in the e-reader market. It has been quite difficult for other players to catch up. To its credit, B&N has some of the most popular e-readers around in the NOOK family. But the price wars with Amazon seem to be hurting the company badly.
Barnes & Noble really has to invest more than it previously expected to keep up with Kindle,
explained Morningstar analyst Peter Wahlstrom. In order to compete with Amazon, B&N and other players in the e-reader market need to be willing to lose some money or so it seems. Amazon is already losing a few dollars on each Kindle Fire unit sold. Amazon Kindle Fire is still $50 cheaper than NOOK Tablet.
B&N has promised to become even more aggressive in its fight with Amazon. But we do not see how the company tops the platform Amazon has developed in the past few years. The launch of the Kindle Fire has been so successful that Amazon seems destined to become the top Android tablet maker. B&N has some catching up to do to stay competitive.