This week was quite eventful for the tech sector, with a lot of significant developments related to major companies like Microsoft and Amazon. We analyze a few such developments which could impact their value in the coming years.
This week, Microsoft may have made a brilliant strategic move. It acquired a 17.6% stake in a new subsidiary floated by Barnes & Noble, which will include its Nook business and its educational College business for $300 million. This will pit it directly against Amazon, Apple and Google in the e-book market, and also secure e-book content for Windows 8 tablets, improving their competitive position against the iPad, Kindle Fire and Android tablets.
We also saw reports, which suggest that Microsoft may be planning to launch a new subsidized Xbox 360 console, bundled with the Kinect and an Xbox Live subscription in order to boost sales, and get customers hooked on to Xbox Live to generate additional recurring revenue. This could also be a part of Microsoft’s larger play in the digital content space.
Amazon is apparently planning to create video content for its platform through Amazon Studios. If this were to be true, Amazon would get some additional leverage over movie studios and may help it disrupt the online video business next, just like it did with the e-books business by launching its own book publishing unit.
Amazon also rolled out an update to AmazonLocal, its daily deals offering, to enable customers to build a profile in order to get better deal recommendations. The Kindle Fire also made the headlines this week, when it was revealed that it represented more than half of all Android tablets sold in the U.S in Q1 2012.