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Amazon.com has halted sales of its Kindle e-reader in Canada. (Mark Lennihan/The Canadian Press/Mark Lennihan/The Canadian Press)
Amazon.com has halted sales of its Kindle e-reader in Canada. (Mark Lennihan/The Canadian Press/Mark Lennihan/The Canadian Press)

Publishing

Kobo is keeping Canada in the vanguard of the e-book revolution - for now Add to ...

With online bookselling giant Amazon.com having halted sales of its Kindle e-reader in Canada and dismissive messages awaiting Canadians who attempt to shop at Google's new online bookstore, it might seem that the Great White North is frozen out of the hottest trend of the shopping season.

But the truth is that Canadians are playing a big part - both as customers and players - in the e-book revolution that has upended sales of traditional books and is expected to vault past the $1-billion in sales it achieved in North America last year.

Not only is the Kobo e-reader currently the bestselling gift at the bricks-and-mortar bookstores of the device's corporate parent, Indigo Books and Music, but Toronto-based Kobo Inc. is already selling books worldwide through an online store that pioneered many of the features touted at this week's launch of the U.S.-only Google eBooks service.

The most interesting feature of the latest e-bookstore is that "Google isn't bringing anything new to the party," Kobo CEO Michael Serbinis said in an interview. "Customers around the world can already access millions of books, newspapers and magazines on Kobo."

The Google eBooks service has drawn praise for its openness as it permits access by users of many different devices. By contrast, Amazon.com sells ebooks for exclusive use on the Kindle, which cannot be used to buy books at other online stores.

But the Kobo service has been "device agnostic" since its inception, Serbinis said. "We've had an open model from day 1. That's been our focus and that's what why we are where we are."

The company is already selling e-readers through Wal-Mart, the world's biggest retailer, as well as stores operated in the United States by the Borders Group, which partnered with Indigo to launch Kobo one year ago. It has also signed deals to preload its application onto new gadgets from such leading electronics manufacturers as Samsung, BlackBerry and HTC, and is "top-ranked on the Apple app store," Serbinis said.

But record growth may not be enough in a market as cutthroat as it is booming. Despite Kobo's confidence in the face of Google's advance, the share price of its corporate parent, Indigo, fell precipitately this week on news of a potential merger between Borders and archrival Barnes and Noble. Analysts speculated that any surviving company would likely bury Kobo in favour of Barnes and Noble's own online store and its Nook e-reader.

The Nook has never been available in Canada, and Google eBooks greets Canadians with a message telling them they can't buy any books. As for Amazon, it stopped all pre-Christmas Kindle shipments to Canada last week, citing supply problems.

Such problems do not affect U.S. customers, Serbinis noted. "Unfortunately, they treat Canadian customers as second-class citizens."

Last year at this time, e-books accounted for about 1 per cent of the sales at major U.S. publishers. A few months after Christmas, however, the share had jumped to 9 per cent. "I think we're going to see the same kind of pop at the beginning of this year," Serbinis said.

While Kobo keeps its more traditional corporate parents in the new game, independent Canadian bookstores are looking to Google to help them earn a piece of the same action, according to Mark Lefebvre, president of the Canadian Booksellers Association.

"The thing I like about this is that Google's not trying to go it all alone," he said, adding that he initiated discussions with the information giant after learning it planned to allow established retailers to use its service to power their own online offerings. "They're trying to collaborate with retailers."

The promised partnerships will benefit both parties as well as customers, he added. "It will give them yet another option."

The Google service closely resembles the model pioneered by Kobo, "which is something I really admire," Lefebvre said. "Talk about a Canadian success story."

Doug Minett, owner of The Bookshelf in Guelph, is likewise enthusiastic about the proliferation of e-bookstores and potentially cannibalistic e-readers. "I think it's great that there may be a number of choices for those of us who want to sell e-books but don't have the pocket to start up distribution companies," he said. "At least it allows us to play."

By contrast, Amazon revealed its attitude toward traditional retailers earlier this year by releasing an application that allows shoppers to scan titles they find in bookstores and buy them immediately from Amazon.com or the Kindle bookstore.

Google has already announced partnerships with several U.S. retailers, but has yet to enter negotiations with any Canadian bookstore. The company did not return calls requesting information on its plans in Canada.

Rather than independents, Kobo is targeting "major tier-one partners worldwide" to help with distribution, according to Serbinis. "Some independent booksellers may find Google sufficient for their needs, but the majority of major players worldwide are choosing Kobo," he said, citing partnerships with leading chains in the United States, Hong Kong and Australia.

"Customer experience really matters here," he added. "Anyone who thinks that just providing a big pile of books is enough is going to have a tough time in this market."

 

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