B&N Fights Fire with $199 Nook

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Barnes & Noble is taking on Amazon’s Kindle Fire with a new, lower-priced Nook Tablet that costs $199. Price point aside, the Nook Tablet 8 GB shares many similarities with the Kindle Fire. Both are Android-powered 8GB, Wi-Fi only devices with 7-inch, 1024 x 600 multi-touch displays.

The Nook Tablet 8GB model packs a dual-core, 1GHz OMAP4 processor from Texas Instruments like the one found in the 16 GB version, but it ships with half the RAM — 512MB versus a full gigabyte. Internal storage can be upgraded by popping in a microSD Card of up to 32 GB in size for a total of 40 GB.

Barnes & Noble continues to sell the 16 GB version for $249, but it shaved $30 off the Nook Color, which now sells for $169 from $199.

New Volley in the Starter Tablet Wars

Although ostensibly marketed as e-readers and media consumption devices, both the Nook Tablet and Kindle Fire are low-spec Android tablets, for all intents and purposes. And the prospect of an inexpensive, starter Android tablet has attracted the attention of modders.

These gadget enthusiasts, seeking an escape from custom UIs and branded ecosystems, have taken to “rooting” their Nooks and Kindles. What they create, by and large, are devices that handle the bulk of tablet-centric activities without paying twice as much for premium hardware.

This concept of a starter tablet is connecting with average consumers, even if left un-modded. Though the Nook and Kindle Fire lack consumer-friendly features like the cameras on the iPad 2 and the blistering video and games performance of the latest multi-core Android slates, it hasn’t stopped shoppers from snapping them up.

According to analysts’ estimates, Amazon sold up to 6 million Kindle Fires in Q4 2011. The Kindle Fire launched in November 2001. Barnes & Noble is tight-lipped when it comes to concrete Nook Tablet sales, but the company’s just-released third quarter earnings point to healthy sales.

The Nook business unit, which includes sales of hardware, accessories and digital content, saw sales rise 38 percent during the third quarter to reach $542 million. Nook hardware sales saw a 64 percent increase over the same period a year ago.

Pedro Hernandez is a contributor to the IT Business Edge Network, the network for technology professionals. Follow him on Twitter @ecoINSITE