RealTime IT News

The Newsstand Wars

In a move that helps in part to counter a recent magazine deal by rival Borders.com, Barnes & Noble.com and Barnes & Noble Inc. increased their investment in Internet magazine retailer enews.com to a majority stake.

In addition to selling directly through its own Web site, enews.com has powered the Barnes & Noble.com magazine store on an exclusive basis since March 1998.

Now, Barnes & Noble will incorporate magazine subscriptions into the bookseller's 569 real-world superstores, each of which has an extensive newsstand area.

Financial terms of the deal with enews were not disclosed. Last week, Ann Arbor, Mich.-based Internet bookstore Borders.com did a partner deal with MegaMags Inc. and launched an online magazine newsstand offering 21,000 titles.

Barnes & Noble also said it plans to launch a pilot program with enews.com to offer subscriptions to the college student marketplace through Barnes & Noble's more than 400 college bookstores, and is exploring a number of other online and off-line initiatives.

"Our majority interest in enews provides Barnes & Noble with a powerful marketing and e-commerce platform," said Steve Riggio, vice chairman of Barnes & Noble.com. "We intend to create a variety of exciting new marketing opportunities for magazine publishers. Additionally, the enews commerce platform positions us well in the emerging market for broadband wireless devices, as we will be able to deliver magazine content digitally."

Barnes & Noble.com has held a stake in enews since December 1999. A number of the original investors in enews will retain a minimal stake in the company. enews will retain its strategic relationships with major magazine publishers, marketing partners and its network of more than 85,000 affiliates, and the enews Web site will continue to serve customers.