Microsoft to Take Stake in Nook Unit of Barnes & Noble

BY MICHAEL J. DE LA MERCED AND JULIE BOSMAN

4:04 p.m. | Updated

Microsoft announced on Monday that it would invest $300 million in Barnes & Noble’s Nook division for a 17.6 percent stake. The deal values the e-reader business at $1.7 billion.

The move by Microsoft will help bolster the standing of Barnes & Noble’s fastest-growing unit. The bookstore giant had said this year that it was exploring strategic options for the business, including a potential divestiture or strategic partnership.

The company has wagered heavily on the Nook, whose e-readers and tablets compete against Amazon’s best-selling Kindle devices in the hotly contested world of electronic books.

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•  Documents: The press release
• Barnes & Noble Shares Leap on News of Microsoft Deal
• Barnes & Noble’s Nook Unit Is Worth More Than Its Parent Company

Earlier this month, Barnes & Noble announced a new black-and-white e-reader with a glowing screen so that it can be used in the dark. The introduction of the e-reader was followed by strong reviews from critics, and Barnes & Noble executives said the device is already sold out.

Both Barnes & Noble and Amazon are spending heavily to maintain a foothold in light of Apple’ssuccess with the iPad.

Mike Spencer/Wilmington Star News, via Associated PressBarnes & Noble bookstores prominently feature displays of Nook e-readers.

The Nook division’s growth has come at enormous financial cost, weighing down on Barnes & Noble’s bottom line and prompting the strategic review. The retailer added on Monday that it was still weighing other options for the business.

The investment from a deep-pocketed tech giant will give Barnes & Noble breathing room, allowing the company to continue to spend money developing Nook devices.

“It gives them a much larger, financially stable partner,” said Peter Wahlstrom, a senior analyst with Morningstar Equity Research. “The bricks-and-mortar side of the business is profitable but all that cash goes into investing in digital.”

For Microsoft, it is an opportunity to expand its efforts in the tablet arena, said James L. McQuivey, an analyst with Forrester Research.

“This is a way for Microsoft to have a hand in the physical tablet business without actually being in the physical tablet business,” he said.

Shares of Barnes & Noble were up more than 61 percent in midday trading on Monday, giving it a market value of $1.3 billion — still less than the valuation of just the Nook unit. Microsoft shares were little changed at $31.99.

Through the deal, the two companies will settle their patent disputes, and Barnes & Noble will produce a Nook e-reading application for the forthcoming Windows 8 operating system, which will run on traditional computers and tablets.

The new division, which has yet to be renamed, will also include Barnes & Noble’s college business. It is meant to help the business compete in what many expect to be a growth area for e-books: the education market, something that Apple has already set its sights on.

The new company and “our relationship with Microsoft are important parts of our strategy to capitalize on the rapid growth of the Nook business, and to solidify our position as a leader in the exploding market for digital content in the consumer and education segments,” William J. Lynch Jr., Barnes & Noble’s chief executive, said in a statement.

In an interview, Mr. Lynch said the company would maintain a strong relationship between the digital busineses and the brick-and-mortar stores. “We’re not changing the base number of the stores materially,” Mr. Lynch said, noting that there are many cities with high-income residents that no longer have a bookstore in the wake of Borders’ liquidation last year. “We’re looking to play a little offense with the bookstores.”

Barnes & Noble will capture additional points of distribution from hundreds of millions of Windows users, potentially reaching consumers who did not associate the bookseller with e-books.

Publishers appeared to be cheered by the news. Mr. Lynch said that he had received encouraging e-mails Monday morning from chief executives from five of the six major publishers in the business.

“These publishers are completely aligned with Barnes & Noble,” Mr. Lynch said. “Publishers are going to like this deal a lot.”

Barnes & Noble was counseled by the law firm Cravath, Swaine & Moore, while Microsoft was advised by Simpson Thacher & Bartlett.

Boeing Dreamliner 787 in Britain: A dream for passengers

Mark Rowe takes a look at the Boeing Dreamliner 787, currently in Britain on a world tour, and is more than impressed with what he finds.

The Boeing Dreamliner 787 is in Britain this week  Photo: PA

By Mark Rowe

5:23PM BST 23 Apr 2012

88 Comments

The clue is in the name. From its unusually high ceilings and flexible wings to the large windows that can be dimmed at the touch of a button, Boeing’s 787 Dreamliner appears to raise the bar in terms of style and comfort in the sky.

Despite being originally slated for launch in 2009, a series of technological delays has meant that only nine 787s are currently in service, all with Japanese airlines. However Boeing is finally embarking on a world tour with one of its test aircraft, arriving at London Heathrow today with all the razzmatazz of a PR company promoting a new pop idol.

British-based passengers must wait until next summer, when Thomson Airways becomes the first UK airline to fly the Dreamliner, although the company starts taking bookings for 2013 summer holidays to Cancun and Florida from Gatwick and Manchester on the aircraft later this week. Thomson has ordered 13 Dreamliners, which it will configure with a premium club seat pitch of 38 inches and economy seat pitch of 34 inches. British Airways starts flying its 24 Dreamliner fleet next year, exclusively out of Heathrow, while Virgin Atlantic will start flights in 2014.

^{Steve Ridgway, the CEO of Virgin Atlantic, tries out a Dreamliner seat}

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The Dreamliner can fly up to 290 passengers up to 8,500 nautical miles, putting non-stop flights from London to Perth or Honolulu within reach, along with other major destinations, such as San Francisco, Shanghai, Singapore, Buenos Aires and Tokyo.

But as the first mid-size airplane capable of flying long-range routes, it raises the intriguing possibility of new non-stop routes from regional UK airports, such as Manchester to Bali, or Glasgow to Cape Town. “If you can fly from your local airport at a price you can pay, and the airline can still make a profit, and you get a more comfortable ride, then it will make for the right combination,” said John Strickland, an independent aviation analyst and director of JLS Consulting.

Boeing Dreamliner 787, Airbus A380 and the jumbo jet: How do they compare?

Aesthetically, the aircraft is elegant and easy on the eye, far more so than the forbidding A380 super jumbo. The edges of the two engine casings are shaped as chevrons to enhance fuel efficiency, while the wings taper to arched tips that lend the contours of the aircraft an oriental appearance and make it look more “birdlike” than any other aircraft. Boeing says the Dreamliner’s chunky overhead bins allow every passenger to store one large bag near their seat.

^{The overhead bins should allow passengers to store one large bag near their seats}

The windows are typically 30 per cent larger than on other aircraft, and those windows by the rear exit doors are better for whiling away the time than the opaque glass on the A380.

By adjusting the wings – they lift by up to three metres - pilots say they can smooth out the ride and minimise the effects of turbulence. “Whatever the level of turbulence, it will bring it down a few notches compared to what you would experience on other aircraft,” said Stephen Riley, head of flight operations for BA “This is a game-changer, a step forward in technology. There’s definitely a ‘wow’ factor - even for pilots when they step on board. ”

Unlike the traditional aluminium fuselage, the 787’s eye-catching body is made from a composite mixture of carbon and polymer resin. These plastic composites enable the aircraft to maintain a higher cabin pressure, recreating the conditions of an altitude of 6,000ft, rather than the more typical 8,000 ft, meaning passengers should experience fewer symptoms of jetlag, such as headaches, dizziness and dehydration.

The interest in such a futuristic aircraft of a company such as Thomson, which specialises in the conventional package holiday market, lies not just in the emphasis on greater passenger comfort but in the greater fuel efficiency. The 787 uses about 20 per cent less fuel, costs 30 per cent less to maintain, and has a noise footprint 60 per cent smaller than aircraft of the same size.

“This aircraft might have been built explicitly with our airline in mind,” said Chris Browne, managing director of Thomson Airways. “This is the first aircraft that Boeing has designed which makes the comfort of passengers as important as the safety of the flight. It makes for a smoother ride for nervous passengers – more than 40% of our passengers would fly long haul if the journey was more comfortable.”

Cabbie unlikely celebrity in Colombia sex scandal

By FRANK BAJAK, Associated Press – 1 hour ago  

CARTAGENA, Colombia (AP) — The Secret Service sex scandal has spawned X-rated jokes, inspired a spicy song set to a local Caribbean beat, and made an unlikely celebrity of a 42-year-old taxi driver who lives with his mother and now seems to be in hiding.

With no other decent leads locally, scoop-hungry journalists fought all week for the favor of Jose Pena, the president of the Hotel Caribe taxi stand who happened to drive home the prostitute who set the scandal in motion.

Fiercely competitive reporters from tabloids to TV networks accused one another of bidding up Pena's fees. He would disappear for hours in the employ of one or another, the spurned reporters redialing him incessantly, filling his voice mail box with entreaties.

It was Pena, after all, who led journalists to the whitewashed, two-family house on a quiet cul-de-sac on the edge of town where he said the woman lived with her 9-year-old son. And he described how the woman told him a Secret Service agent refused to pay her full fee and locked his door at the five-star hotel the morning of April 12.

"He's the most important man in the world this week," joked fellow taxi driver William Jimenez.

Colombians had riotous fun at the Americans' expense on Twitter and Facebook, with one wag tying the charge that one of the agents had tried to shortchange one of the prostitutes with the U.S.-Colombia free trade agreement whose implementation was announced just after the summit:

"I don't think any mistake was made. They thought that now that the FTA was approved there was no need to pay tariffs."

There was also a sense of indignation. "It's pretty clear that they want to treat Latin America as a brothel," the Colombian newsmagazine Semana quoted one tweet as saying about the U.S. agents.

The scandal broke after police and hotel security workers were called into the dispute between the woman and the agent over money.

Soon, 11 agents were headed back to the U.S. to face misconduct charges. Six have since lost their jobs, and the U.S. military is separately investigating 11 servicemen. U.S. investigators have determined that about 20 Colombian women spent the night at the Caribe with members of President Barack Obama's security detail less than 48 hours before his arrival for a summit.

"The secret agents didn't think about Obama. All they thought about was being in bed," said the song taking off on the scandal that got its video release Saturday evening at a Cartagena club.

Several dozen U.S.-based reporters had rushed to the colonial Caribbean port to report on the developing sex scandal, joining those already there to cover last weekend's Summit of the Americas.

They've scoured bars and discotheques that prostitutes frequent, with names like Isis and Elektra, logging hours and downing overpriced cocktails while trying to find at least one of the women who allegedly spent the night with members of Obama's security detail.

It didn't help that Hotel Caribe workers were muzzled by their employer and normally helpful senior Colombian police and government officials also clammed up.

One news outlet eventually published photos, found on Facebook, that it said were of the woman who set off the scandal.

The Facebook page was taken down soon after, but by then reporters had a photo of the bikini-clad woman to help in their search. It was shown to desk clerks, maids and bellhops in hopes they would identify her as having been at the hotel.

Neighbors of the home where Pena took journalists identified the woman as "Dania," a woman in her mid-20s from the Caribbean island of San Andres who abandoned her home Wednesday morning with her 9-year-old son and live-in maid and went into hiding.

Other taxi drivers also tried to cash in on the media frenzy. One tried to charge a reporter eight times the customary fee.

"Pena charged 500,000 pesos ($280) for the same thing," driver Marcos Miranda objected after a two-hour hire before resignedly accepting the equivalent of $30.

Yet Pena also broke a code of silence that protects sex workers and others, including cabbies, who take a cut of their earnings in exchange for finding clients, several drivers said privately.

Pena sounded distressed Friday in a phone conversation. Colombian prosecutors had called him in for questioning later that morning and he said he was afraid of being thrown in jail.

An Associated Press reporter who was still trying to catch up with him to have him identify the published photo as the woman he drove home from the Hotel Caribe encountered a worried mother, Gloria Hoyos, at the family home. "I don't eat. I don't sleep," she said, fighting back tears.

By Saturday, Pena's dizzying ride helping the media was over.

His one-story house in a lower-middle class neighborhood, where his 68-year-old mother sells gelatin desserts and flavored ice through barred windows, was shuttered and sealed with a padlock.

The woman known has Dania, meanwhile, has retained a lawyer named Marlon Betancourt, who has refused requests by the AP for comment. But he told another news organization that his client expects to sue the Secret Service agent for abusive behavior.

And his client intends to sell her story.

A police officer at the prosecutor's office, who was not authorized to be quoted by name, predicted big things for "Dania."

"She's going to be famous," he said. "Just wait. She'll be on the cover of Playboy magazine."

___

Associated Press writers Pedro Mendoza and Marko Alvarez in Cartagena and Vivian Sequera in Bogota contributed to this report.

Frank Bajak on Twitter: http://twitter.com/fbajak

Copyright © 2012 The Associated Press. All rights reserved.

Sex and Drugs

The events in Cartagena and more importantly, our governments reaction to it is embarrassing. Watching our government officials squabble over this latest discovery of evidence that the DNA trumps everything!

The American government is acting like an embarrassed and guilty schoolboy, ashamed for his feelings after viewing pornography for the first time.


This is laughable, as public figures attempt to  bring a new perspective wring their grandmotherly hands in outrage of this public outing of the true intention of the DNA, which, after all, simply put, is to fuck. Keep evolution advancing here on this planet in these receptacles that house that old wire coil of life that traces back to the beginning. Toss out a mutation here and there, see if it sticks.

Drugs have been used for centuries to change consciousness. Without them surgery was quite painful. Prohibition did not work for alcohol, and merely spawned the underworld gangs like Al Capone, today its mexican and Central American drug cartels.



So while we react to what the media blurbs to us, focusing our own neurological hooks into this instant electronic presentation of events, the real problem persists.

In drug war, give peace a chance

STEVE HUNTLEY shuntley.cst@gmail.com April 19, 2012 8:20PM

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Updated: April 19, 2012 10:14PM

 

‘Legalization is not the answer,” President Barack Obama told Latin-American leaders complaining that U.S. demand for drugs is fueling the appalling violence and rampant corruption from the narcotics production and trafficking in their countries. Well, as has become painfully obvious, the war on drugs isn’t the answer either.

That futile campaign waged predominately in Central and South America and in poor neighborhoods in U.S. cities is a failure — and that’s putting it mildly. If the wars in Iraq and Afghanistan were the never-ending, never-succeeding megaflops that the war on drugs is, we would be heading for the exits at breakneck speed or ordering up a troop surge and committing the nation to do whatever it takes to win.

Escalation of the war on drugs hasn’t worked. When did you ever read about drug pushers going straight because they had no marijuana, cocaine or heroin to sell? Or that drug rehab clinics were inundated by addicts who could no longer afford their habits because the feds had so squeezed the supply line that a coke snort cost as much as a bottle of Echezeaux Grand Cru 1990, Domaine de la Romanee-Conti ($1,000)?

And no one is advocating escalating the war on the demand side by jailing more users. Our prisoners are bursting at the seams with non-violent drug offenders.

So, what to do?

“I think,” Obama told the Summit of the Americas last week, “it is entirely legitimate to have a conversation about whether the laws in place are ones that are doing more harm than good in certain places.” But he offered no ideas beyond that vague remark.

Republicans have been no better. When former Rep. Dennis Hastert visited the Sun-Times editorial board a few years ago (before he became House speaker), I brought up the issue. He said no moral society legalizes drugs.

Yet how can a moral society stand by and watch the tens of thousands of killings by drug cartels terrorizing Mexico in service of a trade that goes into the lungs, up the noses and into the veins of millions of Americans? And while the gang violence plaguing our inner cities is a complex issue that goes beyond the drug trade, there’s no denying that pushing dope enriches gangs and contributes to the senseless killings.

With war failing, why not give peace a chance? By peace, I mean venturing into legalization. Marijuana doesn’t strike me as significantly more hazardous, if at all, than the beer, wine, Scotch and vodka that are my recreational drugs of choice. Legalize, regulate and tax its production and use.

I understand that legalizing marijuana would not end the illegal trade in more serious substances such as heroin or cocaine.

But it would deprive the cartels of serious money. It would save lives. Yes, there would be a moral tradeoff in that decriminalizing marijuana would bring more pot smoking and addiction, but that’s a tradeoff we accepted on alcohol by repealing Prohibition to end mob bootlegging and violence and to liberate millions of Americans from the ranks of aiding and abetting crime. How is respect for the law enhanced with laws that millions thumb their noses at?

If legalization fails, we can always go back to prohibition. Alas, I’m under no illusion that our society will take a common sense approach of trying this anytime soon. We’ll stick to the illusion that we can win the war on drugs.

This is absolutely nuts, I will post comments later

Pentagon investigates 10 military members in Colombia scandal

April 17, 2012 12:00 am

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By David S. Cloud and Kathleen Hennessey / Los Angeles Times

WASHINGTON -- The Pentagon is investigating 10 U.S. military members in a widening inquiry into whether an advance team led by the Secret Service hired local prostitutes or engaged in other misconduct before President Barack Obama visited Colombia for a weekend summit, U.S. officials said Monday.

The Pentagon investigation is focusing on five Army Special Forces soldiers, two Marines, two Navy personnel and one member of the Air Force, a U.S. military official said. The Navy and Air Force personnel belong to an explosives detection unit, said the official, who spoke on condition of anonymity.

At least five of the 10 were being flown back to the United States on Monday. A U.S. colonel was en route to Cartagena to supervise the Pentagon portion of the investigation into an incident that has embarrassed the White House, the Secret Service and the Pentagon.

"We let the boss down," Army Gen. Martin E. Dempsey, chairman of the Joint Chiefs of Staff, told a Pentagon news conference, referring to Mr. Obama. "I can speak for myself and my fellow chiefs: We're embarrassed by what occurred in Colombia, though we're not sure exactly what it is."

The Secret Service ordered 11 agents home from Cartagena on Thursday, a day before Mr. Obama arrived, after local police were called to their beachfront hotel and discovered women believed to be prostitutes in several rooms. The agents, who were not part of the elite unit assigned to protect Mr. Obama, were placed on administrative leave. White House officials said the president's security was not compromised.

Mr. Obama told a news conference Sunday in Cartagena that he would be "angry" if the allegations of misconduct were true because he expected U.S. government representatives to act with "the utmost in dignity and probity."

The president said he would withhold judgment until the investigation is complete. "I expect that investigation to be thorough, and I expect it to be rigorous," he said.

When news of the scandal broke, the military said five service members had been confined to quarters in Cartagena for violating curfew. But a preliminary investigation by a military officer from the U.S. Embassy in Bogota determined that more members of the military may have been involved, and five more names were added, officials said.

All 10 service members were staying at the luxurious Hotel Caribe on the seafront in Cartagena. The 11 Secret Service agents had rooms in the same hotel. Some Americans there engaged in heavy drinking and rowdy behavior, triggering complaints on the night of the incident, according to published reports.

The 10 military members "were in the same hotel, and when the police were called, they somehow got caught up in the incident," said Col. Scott Malcom, a spokesman for the U.S. Southern Command, which is handling the military investigation.

Pentagon press secretary George Little said the military members were assigned to support the Secret Service in preparation for Mr. Obama's official visit to the weekend Summit of the Americas, which ended Sunday.

Mr. Little said they were not directly involved in presidential security.

First Published 2012-04-17 04:20:00