In announcing Barnes & Noble's third-quarter results last month, CEO Ron Boire said right-sizing the Nook business was one of his main priorities. On March 15, B&N closed its NOOK App store. Now it is outsourcing some NOOK technology services to Bahwan CyberTek.
BCT, a global provider of software products and services, will take over cloud management and development support for NOOK software, among other services. As a result of the transition, B&N will close both its Santa Clara, Calif., and Taiwan offices by July 2016.
Despite the move, B&N reiterated that it remains committed to the NOOK business. “Over the last two years, the company has done a significant amount of work to improve NOOK’s overall performance,” B&N chief digital officer Fred Argir, said. “We believe that by outsourcing certain technology functions of our NOOK business we will further improve NOOK’s performance.”
The transition to BCT is expected to result in annualized cash savings of approximately, $13 million, which includes approximately $8 million of expense reductions and approximately $5 million of capital expenditure reductions.