Barnes & Noble Launches New NOOKs (Update 1)

Updated from 10:25 a.m. EST to provide additional analyst comments regarding Android in the thirteenth paragraph.

NEW YORK ( TheStreet) -- Amazon ( AMZN) is being officially put on notice, as Barnes & Noble ( BKS) announced not one, but two, new NOOK tablets; the NOOK HD and NOOK HD+.

Barnes & Noble is clearly going after Amazon with the two releases, which are comparably priced to the new Kindle Fire HD tablets. The new 7-inch NOOK will sell for $199, and the 9-inch tablet will go for $269. The 7-inch version of Amazon's Kindle Fire HD starts at $199, while the 8.9-inch model starts at $299.

Barnes & Noble says that the new NOOKs will be available for pre-order online and in stores starting today. The devices will ship in late October and begin arriving in stores in early November.

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Barnes & Noble references the Kindle Fire several times in the press release, and with the dominance of Apple's ( AAPL) iPad in the tablet market, (it had 68% of the market during the second quarter of 2012, according to IDC), it's clear that the retailer's going to war with Amazon.

Just look at this comment from CEO William J. Lynch in the release: "With the combination of the highest resolution screen, lightest weight and expansive access to content rendered in a digital quality never before seen, NOOK HD is the world's best 7-inch media tablet," he remarked.

Barnes & Noble has also incorporated the ability to change profiles so that multiple people can use new NOOK tablets individually. Also included in the new NOOK HD is a new Web browser, and the recently announced streaming service, Nook Video. Stifel Nicolaus analyst David Schick called NOOK Video "a necessary step for the NOOK platform," as Barnes & Noble goes up against Amazon Prime.

Initially NOOK Video will include content from HBO, Sony ( SNE), STARZ, Viacom ( VIA), Warner Brothers and Walt Disney ( DIS).

The NOOK HD has a screen resolution of 1440 x 900, with 243 pixels per inch (ppi), better than the 7-inch Kindle Fire HD, which has 216 pixels. The press release even takes a shot at Amazon, saying " i t's ultra-sharp with 25 percent more pixels than Kindle Fire HD for a better overall viewing experience."

The larger tablets are more comparable, with the NOOK HD+ offering 256 ppi, and the 8.9-inch Kindle Fire HD offering 254 ppi. Both of these pale in comparison to the Apple iPad, which has 264 ppi.

The NOOK HD features a dual-core 1.3GHz high-speed processor and 1GB of RAM. Barnes & Noble claims the battery life offers up to 10.5 hours of continuous reading and up to 9.5 hours of video watching, with the larger NOOK HD+ offering 10 hours and up to 9 hours for reading and video, respectively.

Hudson Square analyst Dan Ernst gave a positive initial assessment of the NOOK HD. "At first glance, Nook HD looks better than Fire HD," Ernst wrote in an email to TheStreet. "Hardware looks a little better, svelte, etc. - more or less same on processor; Nook's content store has been easy to use in my tests, they have a great selection of books, and magazines."

The NOOK HD starts at 8 GB while the NOOK HD+ starts at 16 GB, but both offer expandable memory using a separate microSD card, something Amazon does not.

"It almost gives an investor hope the Nook will be relevant in the tablet wars," said Brian Sozzi, chief equities analyst at NBG Productions and RealMoney contributor. "All signs point to that being false hope, fact is Apple and Amazon are moving way quicker not only on hardware design, but on creating a universe of sticky and streaming content."

It's clear that Barnes & Noble, Amazon and Google ( GOOG) are competing for the lower end the tablet market, while Apple takes the higher end.

One thing that does give Ernst some pause for concern is whether both Amazon and Barnes & Noble, which use custom-based Android operating systems, will be able to do so for much longer. "There are some signs that Google may change that very 'open' approach to Android's free license," Ernst said in the email. "Even if they don't, developers every year have to make special versions of their apps to conform to these two (or more ) variants."

Barnes & Noble's tablet strategy has always been one of great hardware, but the marketing isn't anywhere near the level of Amazon, much less Apple. Perhaps the new NOOK HDs will change this, especially now that the company has Microsoft ( MSFT) on its side.

Interested in more on Barnes & Noble? See TheStreet Ratings' report card for this stock.

-- Written by Chris Ciaccia in New York

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