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iPad May Be the Apple of Jobs' Eye, But Nook's Working All the Angles

Retailers who have put money into electronic readers aren't going to be steamrolled by Apple (APPL) the way other electronics sectors have been. Not without a fight, at least.

The iPod got consumers to drop their portable CD players and disregard other MP-3 devices. The iPhone blew by Blackberry and left Palm Pre choking on its dust. Now comes the iPad.

With characteristic humility, Apple CEO Steve Jobs characterized the iPad as "revolutionary" and enthused, "users are loving it, and we have several more extraordinary products in the pipeline for this year."

In line with the hypemaster's statement, iPad versions that offer Wi-Fi access, including a 3G variation, ship by Friday.

Barnes & Noble (BKS), developer and promoter of the Nook E-reader, isn't giving up. Already, it has developed a retail partnership with Best Buy (BBY), which is advertising the Nook's 3G and Wi-Fi capacity on its home page in the week before iPad can offer the same.

At the same time, Barnes & Noble is rolling out a software update for the Nook that will let users surf the Web and play games. The Nook also will have better Wi-Fi connectivity with the upgrade, faster page turning and better touch-screen navigation. It is more high concept than the more pop-culture iPad. The Nook was developed as a dedicated reader, one that envisioned consumers purchasing books to read on its simple but soothing screen. Apple is pushing periodical content, graphics and the capacity the iPad has to play music and videos.

Barnes & Noble is pushing advantages inherent to its own operation. For one thing, its software update will allow users to read complete books in Barnes & Noble stores for up to an hour a day at no cost, even if that book isn't available at the store. Presumably, the company will make up the money with coffee shop purchases. And it's planning television advertising, which it hasn't done in years, to let consumers know about the Nook's new abilities.

Just as iPad is leveraging iPod capabilities, Nook is building on Barnes & Noble's alliance with Google (GOOG) and its Android operating system. The Nook is Android friendly and the games Barnes & Noble is adding use that system. Expect more announcements on the fruits of the Google alliance.

Of course, Android is the operating system behind the Droid mobile phone. With flashy and expensive advertising behind it, Droid was a hit in the 2009 holidays. Indeed, the Droid might just take a run at the iPhone. So, even if the iPad is getting all the media attention, Barnes & Noble and the Nook aren't licked yet, and they are drawing on all the resources available to them. Barnes & Noble will do what it can to ensure that the iPad and not the Nook is the Betamax of the current era. Keep in mind that Sony, which was the Apple of its time, backed Beta.