Barnes & Noble to fight Kindle Fire with new $250 Nook

Barnes & Noble (s bks) unveiled its answer to the Kindle Fire (s amzn) Monday with the introduction of the Nook Tablet, a more robust version of the Nook Color that will feature beefier hardware and a wide array of content options.
The Nook Tablet will feature a 1 GHz dual-core processor, 16 GB of internal storage, with an SD card slot for 32 GB of extra storage, 1 GB of RAM and a new 7-inch 1024 x 600 display that will offer a laminated, full IPS vivid view display. All of that improves upon the specs of the Nook Color. The Nook Tablet, which will weigh less than a pound, will be available at the end of next week for $249, the price of the older Nook Color, which will now be sold for $199.
Some of Nook Tablet’s specs leaked last week, so the details aren’t exactly a surprise. But Barnes & Noble showed off how it’s corralling content partners, who will offer music, videos and more alongside the Nook’s existing e-book library. Netflix(s nflx) will be integrated for HD movies and TV shows, while Hulu will provide streaming video content, and Pandora, MOG and Rhapsody and other services will supply the music. It’s also partnered with Marvel Comics (s dis) to offer a new Nook Comics application.
It’s a departure from Amazon’s (s amzn) approach with the $199 Kindle Fire, which connects directly to Amazon’s own cloud-based library of MP3s, movies, magazines and books. Barnes & Noble looked to highlight this difference by emphasizing the choice users will have in content providers compared to Amazon’s system.
“We’ve chosen to be much more open and partner with the world’s most popular service like Netflix (s nflx) and Pandora (s p) and we’ll make those applications work better than anywhere else and let the consumer choose,” William Lynch, CEO Barnes & Noble.
Lynch went directly after Amazon’s Kindle Fire, saying the Fire offers an inferior display, half the RAM, limited storage of just 8 GB and a design that was copied from the BlackBerry PlayBook(s rimm). The Nook Color will also offer 11.5 hours of reading time and 9 hours of video playback compared to 7.5 hours of playback on the Fire. Lynch also emphasized Nook’s library of 2.5 million titles, and its industry-leading library of magazine titles. And he pointed out that Nook can offer in-person customer support at 700 locations for Nook Tablet users.
Put simply, “[t]he Kindle Fire is deficient as a media tablet,” Lynch said.
What’s interesting is that while the Nook Tablet provides more storage, its media offerings rely on streaming. Users can side-load the device with their own content, but Amazon still provides a better selection of options for people who want to download content directly rather than stream it. Accordingly, the Fire should logically be the one with more on-board storage, while the Nook Tablet could get away with less.
The launch of a more robust Nook Tablet should help build momentum for the non-iPad (s aapl) tablet market, which has struggled to connect with consumers. With Amazon’s Kindle Fire and the new Nook Tablet, consumers will have a choice of some very affordable, media-focused devices that won’t try to compete head-to-head with the iPad (s aapl) but will instead offer a very affordable tablet experience revolving around specific content. It’s a smart approach that should help open up the market to more price conscious consumers and help introduce tablets to a wider audience.
I think the Nook Tablet should do well, aided by what Barnes & Noble said will be its largest marketing campaign ever. And I like the thoughtful hardware features on the device including its display and design. And the cheaper Nook Color, which will sport the same display at the Nook Tablet, should also provide some good competition for the Kindle Fire. Still, I feel like the Nook Tablet’s content prospects are not as compelling as Amazon’s. Barnes & Noble can claim that its tablet is more “open” compared to Amazon, but it has to because it doesn’t have the assets in place that Amazon does.
Ultimately, the consumer wins this holiday season, thanks to at least two promising options for cheap tablets. Google (s goog) will also benefit indirectly because the Nook Tablet is built on top of Android Gingerbread. But Barnes & Noble and Amazon are showing that Android is just a starting point for them, and a platform that can be manipulated to serve their purposes without help from Google. The Nook Tablet will continue to have its own app store of Android apps, and won’t pull from the Android Market.
It’s interesting to see that both Amazon and Barnes & Noble are poised to really kick-start the non-iPad tablet market by trying to be very different from the competition from Apple. It’s looking like a winning combination.