Barnes & Noble's Nook not going away

Barnes & Noble will outsource manufacture of the color Nook tablet, but continue making black-and-white e-readers.

As Barnes & Noble restructures its Nook tablet business following grim quarterly financial results, it says little will change for the e-reader's users.

With the Nook losing huge money for Barnes & Noble and subsequent resignations and turmoil inside the company, consumers are wondering what's next for the brand.

Barnes & Noble spokesperson Mary Ellen Keating told MSN News Tuesday that the Nook is here to stay, a day after the company's CEO, William Lynch, resigned following grim quarterly financial results that saw Nook sales drop 34 percent.

Related: Barnes & Noble CEO resigns after Nook sales slump

Keating said that as announced earlier, Barnes & Noble will outsource production of new color tablets as it transitions to a "partnership model" for future Nook devices in order to save on manufacturing costs. The company will continue to make black-and-white e-readers.

"Nothing's going to change for our customers," Keating said. "We believe we have a competitive advantage and will continue to serve our customers."

The company has yet to announce the name of the third-party vendor that will be manufacturing the color devices.

Barnes & Noble Nook: Graphic showing Barnes & Noble sales since 2010.Reuters Images

Barnes & Noble sales since 2010

Even with all the restructuring, retail analysts say it's unlikely Barnes & Noble will lose brand loyalty.

"The brand loyalty is strong — it’s not going to waiver just because the Nook division is not doing well," said New York-based analyst Hitha Prabhakar. "Yes, the company is losing money and their CEO bailed on them … but a lot of people still buy books from Barnes & Noble bookstores and their website, and they are going to keep doing so."

Market watchers are speculating that Microsoft, which invested $300 million in the Nook business, might buy it up, according to the New York Times.

Related: Will anyone miss the Nook?

"It might give Nook a fighting chance, but Microsoft has their own tablets now," Prabhakar pointed out.

Whatever happens, the Nook is up against some tough competition from the Amazon Kindle Fire, the iPad's different iterations and other tablets flooding the market, Prabhakar said.


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