Nook Tablet's higher price won't discourage buyers

Priced US$50 more than Amazon Kindle Fire, Barnes & Noble's tablet not a deterrent to consumers whose price tolerance for slate devices is higher, notes analyst.
Written by Liau Yun Qing, Contributor

While Barnes & Noble's new media tablet Nook Tablet, is priced slightly higher than Amazon's Kindle Fire, an analyst has noted that the former's device will still be "successful in its own right".

Barnes & Nobles early this week announced plans to launch the Nook Tablet, a 7-inch media slate with color display and which will allow access to the retailer's digital bookstore through Wi-Fi. To be available Nov. 17, the device is priced at US$299. The U.S company will also slash the price of its color e-reader, the Nook Color, to US$199.

In a blog post following the Nook Tablet announcement, Sarah Rotman Epps, senior analyst at Forrester Research, noted that while the US$249 tablet would give Barnes & Noble a "smaller addressable market" compared to the cheaper, US$199 Amazon Kindle Fire, this would not be a major barrier for the book retailer to see success.

She pointed to a Van Westendorp's Price Sensitivity Meter, conducted by Forrester in September, which found that the optimal price point for tablets was at US$308, making both the Fire and Nook Tablet seemingly good deals for consumers.

Barnes & Noble's move to slash the price of the older Nook Color also gives potential buyers a price-point similar to the Kindle Fire, giving consumers less reason to find fault with the company for offering a more expensive device, Epps said.

She added that the Nook Tablet would have the advantage of leveraging the free in-store service at Barnes & Noble's physical bookstoresm, which would enhance the tablet's value. "[The move] makes good use of Barnes & Noble's best asset and takes a page right from Apple's book," the Forrester analyst said.

A day after the Nook Tablet announcement, Amazon said it would be selling its Kindle devices in more than 16,000 physical stores across the United States starting Nov. 15.

The rivalry between Barnes & Noble and Amazon intensified last month when the former pulled physical copies of DC Comic's titles off its shelves, in protest against DC Comic's exclusive deal with Amazon to sell digital copes of its graphic novels.

Aside from the Kindle, Nook Tablet will also have to contend with current media tablet leader, the Apple iPad, Epps noted. However, the analyst believes the Nook Tablet "will be successful in its own right" and predicted a shipment of 1.5 million to 2 million units in the U.S. during this holiday season.

That said, e-commerce giant Amazon is also expected to sell twice as many Kindle Fires, while Apple will move as many as 20 million iPads worldwide in the fourth quarter with U.S. consumers accounting 8 million of these sales, she noted.

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