RicDay on Publishing

Kobo is suddenly back in the news, after some interesting new deals to sell ebooks in Europe were revealed at the Frankfurt Book Fair. The commentary on how this positions Kobo among the other players in the ebook retail game has been interesting.

Mike Shatzkin wrote a piece Sunday morning which started the discussion ball rolling. He feels that Kobo's deals with retailers WHSmith in the UK and Fnac in France propel Kobo into third position in the global ebook market, behind Amazon and Apple. He separates the US market from the global market, as the US is somewhat unique and more evolved in the transition from print to digital. He (correctly, in my opinion) sees B&N and its Nook reader as a serious competitor in the American market, but invisible elsewhere.

Nate Hoffelder doesn't see the same picture. His response to Mike Shatzkin's post reiterated that Kobo is invisible in the US market (their erstwhile partner, Borders, is out of business as a bookseller of any kind). Nate's piece has a very US-centric point of view, and is accurate within that context.

I have felt from the time Shortcovers morphed into Kobo that the company's future is in selling globally. The partnership with Borders turned ended unfortunately (not because of Kobo, but because Borders was a very inept retailer).

Two years ago, I highlighted a key investor in Kobo which has the financial clout, contacts, and physical retail presence to make Kobo a dominant player in what is potentially the largest market in the world: China and the Far East. The only question I have is, will Kobo go after the market?

Amazon is going to find China a difficult place to do business. They have limited brand recognition and no physical presence. Apple occupies the very important "luxury" end of the business and is expanding its retail outlets in China very quickly. The iPad and iPhone are wildly popular in China and Apple is generally well regarded in Beijing. Amazon has a poor image in China. The claim last week by Chinese website Techweb that Amazon is selling cheap, counterfeit Emporio Armani goods on Amazon.cn doesn't help. (The linked article is in Chinese). Being a big, bad American firm which doesn't like paying taxes also will not help.

If Kobo can make use via its partner of the A.S. Watson retail chain in China, it has the potential to be second to Apple in the market, and perhaps bigger in ebooks.

I speak Chinese (mostly Cantonese). My (adult) kids read Chinese and Japanese books, along with English books. They import their (printed) books from Hong Kong, Japan, and (oddly) a specialist retailer in Europe. They are frustrated that more ebooks are not available to them. The same complaints were echoed in a Skype conversation with friends in Hong Kong just last night.

I like what Kobo is trying to do in Europe. I'm pretty comfortable reading in a couple of the European languages I speak, and I'm endlessly frustrated at the problems of accessing European language ebooks here in Canada. My Chinese friends have the same complaints about English books in China.

If Kobo can crack some of those markets and convince publishers that there is a real, global market no matter which language is used, they will be one of the big three, as Shatzkin postulates.