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Barnes & Noble News, Part II

About a week after Michael P. Huseby’s appointment as C.E.O., Jeremy Greenfield noted, “In the past few months, three key senior executives have left Barnes & Noble’s Nook ebook and digital device division.”

In December, [Jamie] Iannone, the director of digital products, left for Samsclub.com, a division of Wal-Mart, according to the [sic] Wall Street Journal. In mid-January, Barnes & Noble announced that [Jim] Hilt, who was vice president and general manager for global ebooks (essentially running the company’s ebook sales business) will leave the company in February and that [Bill] Saperstein, who was vice president for digital products hardware engineering had already left, according to industry publication Publisher's Lunch.

This led him to speculate about whether they left because (1) the company would soon go out of business or be sold; (2) they each sought greener pastures because the company was performing poorly, or (3) they were forced out because they were William Lynch’s men and Huseby wanted to replace them; (4) a combination of scenarios 1, 2 and 3; or (5) if it was simply a coincidence.

On Thursday, June 5, 2014, Barnes & Noble announced NOOK Media, LLC had “entered an Assignment of Lease for its 208,000 square foot Palo Alto, California campus. Employees will be relocated to new state-of-the art facilities totaling 88,000 square feet. NOOK employees will move to a new facility in Santa Clara, California, while Barnes & Noble College’s digital education employees will relocate to a facility in Mountain View, California. The relocations are expected to occur by the end of the first quarter of fiscal 2015.”

The move was expected to save the company $10,000,000 per year. That same day, Barnes & Noble announced a partnership with Samsung would produce the co-branded Samsung Galaxy Tab 4 NOOK tablets that will combine Samsung Galaxy Tab 4 hardware with NOOK software that will allow users access to NOOK’s catalog of over 3,000,000 digital books, newspapers, and magazines.

A seven-inch model should be available in August. Barnes & Noble will display it alongside NOOK eReaders. Of course, it will also be available online at BN.com.

“We are very excited and proud to partner with Samsung, a world-class technology and tablet leader, to create customized co-branded devices featuring our valuable NOOK reading experience and digital content catalog for Barnes & Noble customers nationwide,” said Barnes & Noble C.E.O. Michael P. Huseby. “Standing behind these great new devices will be the power of our 40,000 Barnes & Noble booksellers combined with our deep bookselling and retail expertise to provide sales support and personalized in-store customer service for our lineup of new Samsung Galaxy Tab 4 NOOK products. Partnering with Samsung brings our customers great new products and evidences our commitment to our NOOK customers and growing our digital content business.”

Huseby noted that Barnes & Noble will continue to offer its NOOK GlowLight™ and continue to provide customer support for its millions of customers. According to a Barnes & Noble press release, “the partnership is a major milestone in Barnes & Noble’s efforts to rationalize the NOOK business. Working with Samsung on co-branded tablets will allow the Company to reduce its exposure to the substantial cost structure and other financial commitments that accompany ownership of the hardware production aspects of the NOOK tablet business. Going forward, the Company will be able to focus on its proven expertise in acquiring and delivering the best digital reading experience to grow NOOK content sales.”

“Samsung has had a strong relationship with Barnes & Noble, offering the company’s award-winning reading experience to users of Galaxy Tab products,” said Tim Baxter, President of Samsung Electronics America. “Samsung is dedicated to providing consumers with choices that best fit their lifestyle. So, we are excited to be taking this next step with Barnes & Noble to offer Galaxy Tab 4 devices that are tailored to the needs of their customers and enhance the NOOK reading experience.” Later in the month, Barnes & Noble, Inc. stated when it released financial date for FY2014 that it would explore spinning off NOOK Media, LLC.