Kobo's big set-piece launch of its new upmarket device—the Kobo aura—held last night in London should be remembered as the moment the e-bookseller became a serious player in the e-book business. This statement might surprise some.
Kobo has been around for a few years—its book fair parties are already the stuff of legend—and it was bought for $315m by the Japanese group Rakuten in 2011. Its likeable chief content officer Michael Tamblyn has rarely been off the conference stage these past years, and its chief executive Michael Serbinis delivered a keynote at last year's FutureBook in front of 500 of the industry's biggest and brightest. When it last reported sales, they were in the tens of millions, and growing fast. It now claims 20% of the global e-reading market, though its share in key markets such as the UK and US is still well below that.
Nevertheless, the launch party, and its other activity around the London Book Fair this year, as well as its commitment to treble its marketing spend in the UK, all suggest a company that now has the backing and confidence to aggressively muscle its way front of stage.
The transition from plucky upstart to industry player might not be easy, however. Kobo's challenge will be to take on the ambition without losing the attitude that has got it to where it is today. As this perceptive piece in the New Statesman suggests: the thing Kobo has on its side for the moment is that it is well-liked in the industry, and has stewarded those relationships even as it has gone from talking to walking.
This was evident from the speeches made by non-Kobo executives at the launch, including Stephen Clarke c.e.o. designate at WH Smith, Faber's Stephen Page, and BA president and independent bookseller Patrick Neale. Some might think that Kobo enjoys its good fortune simply because it is not Amazon. That helps, but the culture of Kobo has always been friendly and convivial. These were people you could find propping up a bar outside Earls Court, as well as on the stage at the latest digital conference sharing data. They liked the book business, and wanted to be part of it.
How much this mateyness can be translated into growth remains to be seen. Its desire for exclusive deals will be one interesting test. It is noticeable that the Khaled Hosseini coup is for the Brazilian Portuguese editions of his works: Brazil being a market that has so far proved resistant to the lure of the dedicated e-reader (Apple is the dominant e-bookseller in the country because of the number of iOS devices).
If Kobo can pull off other such deals in markets where it matters, it might be onto something. But exclusive arrangements can be a doubled-edged sword as Waterstones found out when it did a deal for Glenn David Gold's Sunnyside all those year ago: exclusives lock the content away from some readers and are just one of the things we don't like about Amazon.
But the evidence from the aura launch is that Kobo knows how to develop business relationships for the long term. The slightly edgy speech given by Clarke, where he admitted to "a little bit of falling out, a little bit of hissy fitting" in the early days of that deal, spoke volumes. Kobo and WHS were an ill-fitting match when the device first launched in stores, but both sides have worked hard to make it work, with the Kobo concessions proving to be a good approach—in fact WHS now plans to build 100 more. Clarke said: "The one thing I can say, hand on heart in all my career, it is very seldom you come across people who will put their money where their mouth is like Kobo." Not words the c.e.o. designate of a huge retailer such as WHS should say lightly.
That said, Kobo will need to redouble its efforts just to stay still, while at the same time continuing to expand globally into markets where it can still gain a first-mover advantage. However, the shift in the Kobo mind-set, made visible last night, is also reflected in publishers' attitudes to the company. Anecdotally, there is now talk of real market share growth coming from Kobo in the UK, perhaps as 20p and Kindle-fatigue have settled over UK book readers.
I've always liked the Kobo way, it's people and its long term vision for how reading might evolve. I've also appreciated the way it has tried to bring everyone else with it, understanding, as former high street booksellers should, that bookselling is about more than good meta-data and low prices. But there was always a sense that the fun had to stop at some point if the business was to get serious. I now realise that Kobo might be able to do both--which, after all, is the publishing way.
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