If Barnes & Noble goes down, I don’t think it will be over a price war on very popular e-books. They survive fighting over prices on hardbacks. In 2009, all the big sellers dropped the prices on some books to $9…and those were brand name authors.

Barnes & Noble did effectively split off the digital business (and the college business), and Microsoft put $300 million dollars into it:

http://ilmk.wordpress.com/2012/04/30/barnes-noble-teams-up-with-microsoft-splits-off-nook-college/

B&N will not survive a price war. Maybe they should look for a buyer for their nookbook division which would not be an easy task.