Except when you have to use to the Cloud to get all the media you love.

Confused? Not surprising. Barnes & Noble’s messaging around the Nook, which launched today, is a bit muddled. But let me try to spell it out for you:

Unlike Amazon and its Kindle Fire, Barnes & Noble isn’t marketing its tablet with a proprietary cloud service that will get you access to music, movies and TV shows. Instead, the bookseller is leaving that up to other cloud-based services, like Netflix and Pandora.

But make no mistake — these are cloud-based services. Which means you’re almost always going to need an Internet connection to make them work.

And while Barnes & Noble is playing up the fact that its tablet comes with twice the storage capacity of the Kindle Fire, it doesn’t really think you’ll use that storage for music and video.

That is: You can “sideload” media you own onto the Nook from your PC or another device. But the company doesn’t think you will. It thinks you’ll stream your stuff instead.

In order to move movies and TV shows on the gadget, for instance, you wouldn’t be able to use any digital video you bought from Amazon or Apple. Instead you’d have to get your hands on unencrypted MP4 video files, or something similar. And if you know what that means, or how to do it, you’re not the Nook’s target audience.*

And while it’s possible to move music from your iTunes collection onto the machine, B&N doesn’t think you will do that, either.

Here’s a transcript of the brief exchange I had with B&N CEO William Lynch after his press conference, because I wanted to make sure I understood the company’s take:

Peter Kafka: Do you expect regular users to move media from their device to a Nook, or do you think most of them are going to get music and movies via Pandora and Netflix?

William Lynch: Probably more of the latter. Just because they have most of their libraries … I mean, you have a level of sophisticated user that does the former. But as I said, if you look at Netflix, they have 30 million [sic] subscribers..

Kafka: Right. And if I have music on iTunes, can I move it onto the Nook?

Lynch: You can take your MP3 and MP4 players …

Kafka: So I can convert it to an MP3, and move it …

Lynch: And move it, sideload it.

Kafka: OK. So it’s not really a mainstream use. You expect most people to stream music and movies to the device.

Lynch: That’s right.

After this conversation I triple-checked with B&N’s PR reps, who tell me that customers shouldn’t have to convert iTunes files, because most of them will already be in DRM-free AAC format. But the fact that the company’s CEO thinks they won’t want to sideload anyway is the real takeaway.

[UPDATE: Subscription music service Rhapsody, which will work with the Nook Tablet, tells me users will be able to cache some songs for offline play, so the storage capacity could put to use there. I've asked MOG, another Nook-compatible subscription service, if they're doing offering the same thing.]

There’s nothing wrong with that approach, theoretically. But if you’re not going to store movies on the device, then B&N shouldn’t argue that you could watch 5 HD movies on a long airplane flight, on a single charge, since you wouldn’t have any way of actually getting them (good luck streaming HD movies on airplane wireless). And it shouldn’t tell us that we could watch up to nine hours of video on the machine with wireless off, for the same reason.

It’s also a bit odd for B&N to play up its access to Netflix and Pandora, since those are two of the four apps that Amazon all but promised it would have on the Fire. (To be fair to B&N, it is also offering access to Hulu Plus, and Amazon hasn’t said boo about that.) And again — those are cloud-based services, which means they ought to be careful about reminding us that “people aren’t always connected to the Cloud,” which they did repeatedly throughout their press conference.

Product claims aside, the real story behind the mixed messaging seems to be that B&N still fundamentally views the Nook as a reading device which will let you read the stuff it sells. And you will be able to store lots of that stuff on the Nook, which means you won’t need Internet access to get it.

Digital books, magazines, etc., are a $65 billion to $70 billion market, Lynch said during his press conference. And that’s plenty for him for the time being: “We’re not going to launch something where we don’t think we can add material value just to get into the game.”

Reasonable enough. But Jeff Bezos and company are very much in that game. And if Lynch decides he wants to play later, he’ll have to play catch-up.

*B&N’s target audience is a woman with 2.3 kids, Lynch said after the event. So at the risk of perpetuating a stereotype, I’m going to assume that the advice a B&N rep gave me today — to rip a DRM-free MP4 from a DVD, then port it to the tablet — isn’t the one it’s going to bring up very often in its marketing materials.

What you’ll find on Subtext is a lot like the special features you’d find on a DVD, but for e-books. And you can create your own annotations.

Subtext’s founders come from the gaming industry and their hope is that readers will comment, endorse and share notes on the books themselves. For that participation they will be rewarded with in-app points to be spent on additional author and expert content.

Subtext works most seamlessly with Google Books but it also supports reading and annotations across editions of the same book on various platforms. “To be social we must be open,” said co-founder Rachel Thomas in an interview last week. Subtext doesn’t yet support proprietary books from distributors like Amazon and Apple.

Thomas was previously at Playdom; co-founder Andrew Goldman was CEO at Pandemic Studios.

At launch, Subtext offers 18 enhanced books, including commentary from George R.R. Martin’s editor and researcher on “A Game of Thrones,” character updates by Frances Mayes for her “Under the Tuscan Sun” and movie scenes and interviews for Lisa See’s “Snow Flower and the Secret Fan.”

Readers mark up books with comments, questions, polls and links to Web pages; they can dictate instead of typing; and they can mark anything with a “spoiler alert” tag. They can navigate books page-by-page like normal, hop around through annotations, and see what page their friends are on.

Subtext is iPad-only for now, and is next working on a Web version. The 14-month-old company has 12 employees and raised $3 million in funding from Google Ventures, Mayfield Fund, New Enterprise Associates and Omidyar Network.

See also: my coverage of another social reading start-up called Readmill.

The move follows the Sept. 29 disclosure by DC Entertainment that it struck an exclusive agreement with Amazon.com Inc. to make the titles available for Amazon’s upcoming Kindle Fire tablet, expected to ship Nov. 15. The books include “Watchmen,” “Batman: Arkham City” and “Superman: Earth One.”

Barnes & Noble, which later this month is expected to introduce a new Nook tablet, said it made the decision to remove the titles from its consumer stores on Thursday. Barnes & Noble has previously stated that it expects to be able to sell all formats of all titles that it stocks. The company said it hasn’t take such an action in the past.

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Lately, though, the company’s “pick of the week” program has expanded. It started last month with giving away the paid iPhone app Shazam Encore, and this week’s freebie is an extended book sample from Erin Morgenstern’s “The Night Circus.” The expansion could soon extend to TV shows as well, I’m told.

The Starbucks partnership is one of Apple’s oldest iTunes partnerships, and Starbucks has also been beefing up its digital offerings to take advantage of its in-store Wi-Fi.

In March, Denny Chin, now a U.S. Circuit Judge in Manhattan, rejected a revised $125 million deal to resolve separate lawsuits over scanning books for online distribution by Google via its Google Books site. In his decision, the judge found the pact would give Google the ability to “exploit” books without the permission of copyright owners.

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It’s unclear how much traction the proposal has, the people said. Several publishing executives said they aren’t enthusiastic about the idea because they believe it could lower the value of books and because it could strain their relationships with other retailers that sell their books, they said.

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Shares soared more than 15 percent at one point Tuesday morning to $13.22 apiece as the company recorded the first quarter in two years with better year-to-year bottom-line results.

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A recent IBM poll of 1,500 CEOs identified “creativity” as the top leadership skill needed in the future. But being creative doesn’t just happen. It’s one of those intangible qualities that people simply have or do not. Yet if you could make it tangible — put it in a bottle and sell it — you’d strike it rich. Clearly, there’s something that innovative companies and people have that the less innovative ones lack. Just what the heck is it?

That’s the question that business professors Jeff Dyer and Hal Gregersen set out to answer by teaming up with famous innovation guru Clay Christensen. Nearly 15 years ago, Christensen coined the phrase “disruptive innovation,” and wrote two best-selling books on the subject. The Innovator’s Dilemma and The Innovator’s Solution both examined disruptive technologies, business models and companies.

The Innovator’s DNA, co-authored by all three, makes it a trilogy. In it, they seek to answer the most basic questions about innovation: What makes an innovative company, and what companies can do to become more innovative.

Gregersen is a professor of leadership at INSEAD, the international graduate business school. Dyer, who I spoke with recently, is the Horace Beesley Professor of Strategy in the Marriott School of Management at Brigham Young University. I started by asking him how the idea for the book came about.

AllThingsD: What’s the book about and how did it happen?

Dyer: The book is really the product of a conversation I had with Hal Gregersen and Clayton Christensen. And the question we raised in that conversation was this: Where do disruptive business ideas come from in the first place? What are the origins of disruptive business? And [we wondered] if we could tell people something about where disruptive and innovative ideas come from that might be useful and helpful. One of the things we knew from research in psychology is that if you ask any crowd of people whether creativity is a genetic endowment or if it’s something that’s learned, 90 percent will say it’s genetic. We either have it or we don’t. But the way psychologists research this is they take identical twins — ideally who have been raised apart — and then, between ages 16 and 24, they will give them general intelligence tests. And what they find is that about 80 percent of performance seems to be genetically based. But then they give them creativity tests. There, only 20 to 40 percent of performance is genetically based. What that means is that creativity is much more learned than we think. Therefore the ability to generate innovative business ideas may come from things people learn and do, more than just because the people involved are who they are. For the book, we decided to go back and study business innovators and figure out, as best we could, the antecedents of people coming up with the ideas that they did, and what contributed to their ability to come up with innovative ideas.

And what sorts of things did you study?

One example we looked at was Steve Jobs at Apple. The story that everyone knows is the story of the graphical user interface and drop-down menus and the mouse. He, of course, didn’t originate an idea, but having seen it at Xerox, he returned to Apple laser-focused and determined to apply them to the Macintosh. He assembles a team of engineers and they create the first computer with a graphical user interface. But the idea was really born of an observation. He had seen something that he was able to take back and solve a problem. Another innovation of his was beautiful typography on the Mac and the LaserWriter printer. That came because he dropped out of college, and dropped in on a calligraphy class, and had no idea that it would ever have a practical application in his life. Ten years later, when he was working on the Macintosh, it all came back with the idea for a computer that could create beautiful typography. It was an important differentiation, and it occurred because of a time when he was out exploring. When we looked at the genesis of disruptive ideas, we found that the ideas occured when the innovator was asking a question, engaged in an observation, networked with someone who had a different point of view, or because they were experimenting.

Well, let’s talk about experimenting for a minute. There are lots of ways to experiment with things, and you discuss these in the book. What are they?

We have three ways of experimenting. Most of us think of it as just testing and piloting an idea, and that’s the classic method. But the second is taking apart a product or service or process or idea, and then putting them back together. That’s how Michael Dell came up with the idea for Dell Direct. The other is simply an exploration, where you’re learning a new skill like Jobs did in learning calligraphy — where you’re having a new experience that you can later draw upon. One of the innovators we talked to was a guy named Nate Alder. He came up with the idea for an argon vest. He was scuba diving in South America, and argon gas is used to keep you warm when you scuba dive. He was a snowboarding instructor at the time. He wondered if he could use the same argon to keep warm on cold days. So he came back and developed a line of products called Klymit jackets. And it happened because he was out exploring and trying something new.

So then the problem becomes this: If you’re a CEO or COO reading this book, how do you apply these ideas? I can send my team off for a retreat or something, but they’re not necessarily going to come back any more creative than they were. How do you encourage these behaviors at a company?

What we found is that at innovative companies, there’s a high correlation between the extent to which the leaders of the company engage in and display these discovery skills and the innovation performance of the company. It starts at the top. If you don’t do it, you’re not likely to imprint your behaviors on your organization as processes. What we saw was that when someone like Jeff Bezos is good at experimenting and questioning and coming up with new ideas, he then sets about creating processes within the company for doing experiments. Innovative companies are more likely to have processes that encourage questioning, observing, networking and experimenting. This is how it becomes more embedded in the organization’s culture.

How deep can the questioning go? You can look at Nokia, for example, which made rubber boots and toilet paper. And at some point, someone must have questioned the fundamental business plan that caused it to pivot to building electronics. That’s a pretty fundamental shift. If the questions can go that deep, is it always constructive?

In innovative companies, you find that that kind of question is always okay. And then we try to look at that question from a variety of angles to see if it warrants an answer. In companies that don’t innovate well, those kinds of questions aren’t considered or tolerated. If you don’t try to change the status quo, how are you ever going to innovate? That’s why it’s so important for the leaders to legitimize it, and to say that they want things that are new and different.

This is something you teach, so I wonder what you’ve learned from the process of sharing these ideas with other companies. The reason I ask is that there’s often a lot of entrenched resistance to change.

One of things I’ve done is courses where we teach with the case method — you give the students a case study on Sears or Kmart, and then ask them to come up with a new strategy to compete better with Wal-Mart. I gave one group the task and simply asked them to come up with a new strategy. I gave another group the same case and said that I wanted a new strategy, but that I also wanted it to be creative and innovative. I told them to push the boundaries. In third-party reviews, the groups where I legitimized being creative were all judged as having been more creative and original and likely to make a real difference than in the cases where I didn’t legitimize it.

You also ranked several companies for their ability to innovate. What companies are on your list? Number one and number two are Salesforce.com and Amazon, but I’m also interested in number three. Can you explain them?

We did rank several companies on their innovation prowess, using something we called an innovation premium. We interviewed [Salesforce CEO] Marc Benioff for the book. Salesforce has a founder who is really good at questioning the current model. He asked a fundamental question: In the age of the Internet, why are we installing software on individual computers? He just challenged that whole business model, and continues to try and challenge it now. And we all know about Amazon and Jeff Bezos. He loves to experiment and try new things, even if they’re weird. It’s gone from being the world’s biggest book retailer to the world’s biggest discount retailer to launching the Kindle, and now running Amazon Web Services. They just keep trying new things. Number three was Intuitive Surgical. They make the da Vinci system of surgical robots, and so they’re bringing robot-assisted surgery to the world. They innovated through tons and tons of observations of how surgeons do their work, and then creating robots that could mimic that, and that could be manipulated with tremendous precision.

Finland’s Rovio Entertainment Ltd., the game’s developer, this month will publish the first in a line of books, “Bad Piggies Egg Recipes,” with such fare as egg-salad sandwiches and egg sushi. The title refers to the game’s porcine thieves, who become targets for an enraged group of birds after stealing their eggs.

Next up: Angry Birds in the classroom.

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Amazon will let students (or anyone) buy textbooks at a steep discount to their print list prices, and will charge them based on the amount of time they plan to hang on to the book.

The bookseller says it will generally require a minimum rental period of 30 days, and it will allow students to extend that period at their discretion. Renters will continue to be able to access notes and highlights they’ve made in their texts even after they’ve “returned” the books.

The only surprise here is that it took Amazon this long to get into the business. It introduced the Kindle in the fall of 2007, and since then a flood of start-ups, like Chegg, Kno and Inkling, have targeted the market. Barnes and Noble already has its own e-textbook store.

But while Amazon introduced the high-end Kindle DX, aimed at the college market, in 2009, it has yet to make much headway there.