Chapter 10. The Expansion of Global Platforms

Publishing groups with international reach are certainly not a new feature of the industry, as the strong presence of British houses in all of the former Commonwealth and in the US well illustrate. With the acquisition of the world’s largest trade publisher, Random House, by the German media conglomerate Bertelsmann in 1998, the subsequent reaching out of Hachette in the US and the UK, and the more recent international aspirations of regional groups such as Spanish Planeta or Swedish Bonnier, international expansion has become common. And their parent companies all control various media and related activities, with book publishing in most cases not being the groups’ largest division. (Pearson, the world’s largest publishing group being one exception to this pattern.)

Today, opening offices in the Gulf (like Bloomsbury in Qatar), or even holding corporate management conferences in Beijing (as Penguin did a few years ago) has shown that book publishing is in no way any longer limited by national or linguistic borders.

The recent expansion of distribution platforms and channels, both in reach and in the scope of their offer of products and services, has brought the globalization of publishing, books and reading to an entirely new dimension.

Amazon

When Amazon released data on its 2012 financial performance at the end of January 2013, Jeff Bezos, the company’s founder and CEO, concluded: “We’re now seeing the transition we’ve been expecting. After 5 years, e-books is a multi-billion-dollar category for us and growing fast—up approximately 70% last year” (“Amazon reports record sales growth,” The Bookseller, January 30, 2013). That is certainly true. But Amazon may no longer be in the privileged role of ruling the game almost all alone, as least in the US, due to the introduction of the Kindle in 2007.

Sales from Kindle and tablet devices alone are estimated at $4.5 billion, up 26% from 2012, according to Morgan Stanly, yet with annual growth expected to slow down in the years ahead. For 2014, sales of digital media content is expected to surpass revenues from devices. Overall, the “Kindle ecosystem” is expected to account for 11 percent of the company’s total revenue this year, but 23 percent of its operating profit. (Quoted by Allthings, 12 August 2013).

A major expansion in the ecosystem that Amazon offers to its customers was in spring 2013 the acquisition of the reading platform Goodreads, which had grown, by summer 2013, to a community of 20 million.

Amazon’s International Growth

For the first time ever, the annual report 2012 gave some insight into the stupendous international expansion of the world market leader in online bookselling (Annual Report for fiscal year, ended December 31, 2012, US SEC).

While overall sales of Amazon in North America always exceed revenues from its international business, at least since 2010, international changes in the media sector are clearly ahead of domestic North America (“media” includes, in addition to ebooks, all other digital content: music, movies, and games, but not “electronics and other general merchandise”). Even more remarkably, at least in 2010 and 2011, “international media” showed stronger growth, year on year, than domestic developments. For 2012, international media growth dropped sharpely, from 23 percent for 2011 to 9 percent in 2012 (against continuous growth of 15 percent for domestic media sales—with no further explanation given).

The lion’s share of Amazon’s international revenue came from only three markets, Germany, Japan, and the UK, adding up to $23 billion of the total $26.3 billion for 2012. All other markets combined accounted for just another $3.3 billion, or less than 13 percent of international. This refers to the total turnover, not just media. For Germany, an independent estimate is available that has Amazon’s media revenue at $3.5 billion, and its book division is thought to represent some 20 percent of the German book retail market, most likely making it the number one channel, head on head with Weltbild/DBH (“Amazon kontrolliert rund 20% des Buchmarktes,” buchreport, February 2013).

However, recent growth beyond those three core markets, hence on the really global end of the scale, was even more remarkable, with 69 percent year on year for 2011, and 50 percent for 2012.

Since June 2013, Amazon has started to sell its devices in mainland China, with the Kindle Paperwhite 849 yuan (US$134) and tablet computer Kindle Fire HD with 16-gigabyte memory for 1,499 yuan. (Sina, 8 June 2013)

Also in 2013, Amazon has started selling Kindle devices in India, after its launch of a Kindle shop in 2012, and it has enhanced its presence in India by unveiling its Amazon Associates program. (Shelf Awareness, 14 June 2013 and 9 July 2013)

In addition, Amazon reportedly has started preparation for entering the Russian market with a dedicated website, after hiring Arkady Vitruk, formerly the general director of one of Russia’s leading publishing houses, Azbuka –Atticus. (Russian Book Industry Magazine, 4 July 2013)

Amazon’s own publishing arm had started its international expansion already in late 2012 to Germany and Europe. (Amazon-Verlage nehmen Kurs auf Deutschland, buchreport November 29, 2012) In France, it launched an imprint, Jet City, specializing in graphic novels. (Livres Hebdo, 10 July 2013)

Interestingly, all Amazon figures breaking down international sales reported by Amazon hint at a significant slowdown in its growth for 2012. Growth in overall international media sales dropped from 23 percent year on year for 2011 to 9 percent in 2012. The by-country rates fell on average by more than a third, for Germany, Japan, and the UK. For the rest of the world, the expansion slowed down from a mesmerizing 69 percent in 2011, to a still strong 50 percent in 2012. In the second quarter of 2013 though, international sales have grown by just 13% (after beeing up by 15.9% in the first quarter of 2013).

With no details indicated in the filings of the company, and with no global economic factors providing a plausible explanation for the pattern, it must be assumed that competition is the most reasonable explanation. With more and more hounds chasing the global leader of the segment, on both local as well as global grounds, with Apple, Google, and Kobo, as well as scores of homegrown competitors stepping into the arena, Amazon should probably get ready to meet a bunch of serious challengers in the months and years ahead.

Amazon in the crossfire of international controversies on its tax paying

Founded as an online bookseller in 1995 in Seattle, Washington, Amazon.com, Inc. (NASDAQ: AMZN) portrays itself not as a specialist in books, but as “Earth’s most customer-centric company,” catering to “four primary customer sets: consumers, sellers, enterprises, and content creators.” Even in the short version, the company statement hints at the ambition of Amazon to assume, as a vertically integrated service provider, a broad number of business roles that traditionally had been the domain of a wide array of separate businesses, notably bookseller/retailer, used bookstore, library, publisher, service provider to authors, as well as publisher (including print on demand), ecommerce platform, and marketplace—to name just a few.

The integration of many roles under one roof has, on one hand, opened unique ways of expanding Amazon’s business but has on the other hand drawn critical reactions from many of the traditional players of the book business and resulted in recent controversies.

In 2012, Amazon found itself center stage in a number of controversial debates, notably in Europe. Portraying itself as a global, “pan-European” company, the firm was critisized in Great Briain and subsequently in France for minimizing their tax payments in countries of operation. (For the global debate, see ). Aside from such general critisicm of its business practises, a specific issue with the taxation of ebooks has also provoked controversy across Europe. In the majority of countries of the European Union, printed books benefit from a reduced VAT, while ebooks tend to be subject to the full tax (which makes a difference between zero for print, and 20 percent in the UK, for instance, or 7 percent versus 19 percent in Germany). In fact, Amazon charges its British customers a VAT of the full 20 percent. Yet by having set up European headquarters in Luxembourg, which collects a VAT of only 3 percent for an ebook, Amazon can up its margin by the difference, as it forwards only those 3 percent to tax authorities in Luxembourg. Competitors obviously consider this as a huge challenge, given Amazon’s dominance on ebooks. (Amazon makes UK publishers pay 20 percent VAT on ebook sales, The Guardian, October 21, 2012).

In Germany, the debate on tax has echoed at first less strongly than its expansion in both market share and scope of services. But the perspectives have largely changed in the first half of 2013, in the light of successful “Buy local” marketing campaigns launched by independent local booksellers, a rising critical debate in the media on Amazon’s very modest tax paying (German overall turnover of $8.7 billion contrasted with a mere 118 million of profits for all its European holding in Luxembourg), together with a stand off with unions, and several strikes at its German warehouses. (Frankfurter Allgemeine Zeitung, 12 July 2013)

Earlier developments: 2012 and before

Today’s ebook environment can reasonably be described as having been triggered, directly or indirectly, by the launch of Amazon’s Kindle reading device in 2007. The device was the part visible to consumers, in a much more complex and proprietary, highly integrated system that consisted of Amazon’s leading online platform for selling (printed) books in the US and most major European markets, plus China; a phone hookup allowed the direct ordering and downloading of digital books, and the agreement with publishers—at first the Big Six in the US—to make available a wide catalog of attractive titles under this system.

By mid 2012, the Kindle and its successor devices, notably the color Kindle Fire, were seen as the most popular reading platforms for ebooks internationally, and Amazon set up localized Kindle shops via its website for not just the US but also the UK, France, Germany, Italy, and Spain.

In Japan, Amazon entered into an agreement with 40 publishers, including Gakken and Kadokawa, on the distribution of their ebooks for the Kindle in Japanese (Asahi Shinbun, May 7, 2012).

In August 2012, the Kindle was also launched in India with a catalog of over 1 million titles priced in rupees, making it the biggest ebookstore on the subcontinent.

Amazon, the Kindle, and the related offers—from author services to lending books as a prime customer (available so far only in the US)—form an increasingly integrated sphere, of which significant parts are not available via other platforms. This connection is demonstrated by Amazon’s claim that 180,000 Kindle-exclusive titles are now available on that lending library, and altogether Kindle-exclusive titles have seen over 100 million downloads by late August 2012 (press release, August 28, 2012).

On the other hand, the Kindle device was originally sold only via Amazon’s website, but as of September 2011, it was also made available in other retail channels, such as the Staples office supply stores and the German Karstadt department stores. In May 2012, another—much debated—partnership was been announced with the British book chain Waterstones (buchreport, December 22, 2011, “Amazon verkauft Kindle-Geräte über Karstadt und Staples”).

The first Kindle device was the game-changer for the emergence of today’s ebook market, but various surveys indicate a clear migration of customers from specialized ereading devices to tablet computers. Between August 2011 and May 2012, the preference for the Kindle as the device of choice for reading dropped among US consumers from 48 percent to 35 percent; Amazon’s tablet, the Kindle Fire, seems to have topped Apple’s iPad tablet among ebook users (“Consumer Attitudes Toward E-Book Reading,” BISG study quoted in buchreport, August 2, 2012).

The total revenue from digital content downloads of Amazon was estimated at $1.85 billion in 2011, placing the platform at a rank of 21 among all global ecommerce vendors (“The world’s most successful digital media companies,” paidcontent.org 50, July 31, 2012).

In the UK, Amazon accounts for 21 percent of the entertainment market (according to Kantar Worldpanel, as quoted in The Bookseller, July 24, 2012). In Germany, a study by the University of Hamburg on a panel of 2,000 consumers estimated that 57 percent of German ebook buyers acquired at least some of their digital reading at Amazon in 2011 (Michel Clement and Felix Eggers, “E-Books und E-Reader, Kauf und Nutzung,” Universität Hamburg, January 2012).

For 2011, in the UK, Amazon announced a five-fold increase in Kindle ebook sales over 2010.

Apple

Assessing the market share and impact of Inc. (NASDAQ: AAPL) in the international ebook markets has always been a difficult exercise due to the lack of public statistics. In the first half of 2013 though, some light had been shed on the arguably second largest platform for the distribution of ebook econtent.

Apple executive Keith Moerer put Apple’s market share at around 20% for 2011, when the iBookstore was launched, as well as for for later periods, when books from Random House had been added to the catalogue, after they had been missing at first. Moerer’s statement occured at the hearings at court in summer 2013 over allegations of fixing of ebook prices between Apple and major US publishers. (Publishers Weekly, 12 June 2013)

Earlier estimates had seen Apple’s share closer to 10%, yet growing, notably at the expense of Barnes & Noble’s Nook. (Digital Book World blog, 28 february 2013) Industry analyst Horace Dediu put the figure meanwhile at around 24%, aruguing that overall, between the launch of the iBookstore in June 2011, and October 2012, Apple may have sold some 270 million ebooks, “Apple’s iBooks generated about $1.3 billion in payments and grossed about $1.8 billion”, equalling some 8% of the entire “iTunes universe”. (Horace Dediu: Measuring the iBook market) 28 february 2012.

Yet it has been questioned by some if “Apple even cares that much about ebooks”. (Joe Wikert, quoted in Paidcontent, 11 September 2012)

The more important part of Apple’s role with regard to ebooks might be, in the long run at least, to have integrated books so deeply and seamlessly, in the iTunes ecosystem, with music, movies and all other formats of digital entertainment, thereby spearheading a future in which books and reading simply lose their traditionally priviledged cultural prosition. This perspective is particularly relevant in a global perspective, as in many emerging markets, only poor distribution networks for printed books exist, while the Apple brand, and the download of various content via iTunes has become mainstream, even long before a significant ebook market has evolved in these countries.

In the US in 2013, Apple had gained unwillingly a very prominent position with regard to ebooks in a court battle over ebook pricing strategies, and was found guilty in July of a “violation of Section 1 of the Sherman Act” by conspiring with major publishing houses “to work together to eliminate retail price competition and raise e-book prices”. (Judge Cole in his decision, quoted in Publishers Weekly, 10 July 2013) The implied publishing houses, Simons & Schuster, Hachette, HarperCollins, Penguin and Macmillan had settled the case with the US Department of Justice earlier on. (For a short summary, see The Telegraph, 8 February 2013)

In a similar ruling as of December 2012, the European Commission had adopted “adopted a decision that renders legally binding commitments offered by Apple and four international publishers”, to stop any “collusion to restrict or eliminate competition” as being “simply unacceptable.” (Press release by the European Commission, 13 December 2012)

The ruling on Apple is ending what has been called the “agency model” of publishers setting a fixed retail price for their ebooks. The controvery broke out at first when Amazon had started to discount ebooks below the publishers’ wholesale price, yet backed down in a short and hard standoff in February 2010 with Macmillan’s CEO John Sargent. (The Bookseller, 8 February 2010)

The international expansion of Apple’s iTunes and iBookstore

By December 2012, the iTunes Store had been made available in 119 countries, with hugh markets such as India and Indonesia, Russia, Saudi Arabia and Turkey being able to access an online market place for music and various other digital content. (Apple press release, 4 December 2012)

However, the iTunes universe is not exactly the same in all these markets. On the one hand, pricing can vary significantly, as music is available in India for instance for only 7-15 rupees (then $0.11 to $0.24), much less than in markets in North America or Western Europe. (TheNextWeb, 4 Deceber 2012) Also, not all channels are open in all markets, with notably books having a much more limited reach. In Japan, Apple had reached enough agreements with major local publishers for opening an iBookstore only in early 2013. In most of Latin America, the iBookstore is open since summer 2012, with observers seeing it as the leading distributor notably in Brazil, with a market share of 28.5% in March 2013. (PublishNews Brazil, 2 May 2013)

By summer 2013, iBooks are available in over 50 countries. (http://en.wikipedia.org/wiki/IBooks)

The iBook universe

iBooks is an application that has come bundled with iPads since the device was first introduced by Apple in January 2010. The app allows readers to download digital books in EPUB format from the iBookstore, and it is integrated with Apple’s iTunes platform for the exchange and usage of other file formats, such as PDF.

The iBooks app comes in over 30 language versions, including English, Arabic, Chinese, Korean, and Ukrainian. However, this does not mean that all these languages are also supported for publishing a book to the iBookstore (e.g., Arabic, along with other languages that are written from right to left, are at this point not supported; by the end of 2012, 18 languages were supported, including simplified Chinese). For more information, see the guide)

iBook Author is a free of charge authoring solution, which is also notably promoted for the creation of educational content, witnessing the witnessing[download of 350,000 textbooks] in just three days in early 2012. (For more details on iBooks Author and textbook creation, see below.)

Earlier developments, 2012 and before

In the ranking of paidContent of the world’s top 50 digital media companies, for which only revenue from digital content sales have been included, Apple has been ranked at number 5, with digital revenue (not including hardware sales) of $5.4 billion (http://bit.ly/T1EUu7).

With regard to reading devices, evidence grew in 2012 that tablet computers had gained in popularity versus E Ink–based dedicated readers—to the advantage of Apple’s iPad, which was reported to have been a favorite gift in year-end holidays 2011 not just in the US and UK but also in many other markets (as an example, in France, see Livres Hebdo, February 6, 2012). However, by late summer 2012, with the rollout of the next generation of low-cost ereaders as well as tablets, notably by Amazon, Barnes & Noble, and Kobo, a fierce struggle for market share ensued.

New reading devices will also deeply influence the development of digital publishing. One segment of publishing where this will be leveraged is certainly textbook publishing, a sector famously singled out by Apple’s founder Steve Jobs as being “ripe for digital destruction.” The launch of iBooks Author, together with the iBooks 2 format, which is designed to allow authors to publish stories and notably more complex and multimedia content directly to the iBookstore—is a toolset that the Economist labeled a “breakthrough in transforming how textbooks are created and distributed” (The Economist, January 20, 2012). Apple’s initiative was not directed only at eventual authors—in any field requiring “media-enriched” publications—but also included from the beginning the adaptation of existing textbooks from major educational publishers, notably Pearson, Houghton Mifflin Harcourt, and McGraw-Hill, making all these materials directly accessible and purchasable through the iBookstore.

Barnes & Noble

The announcement of senior leadership changes in early July 2013 highlighted the complex challenges that Barnes & Noble is currently confronting. The resignation of CEO William Lynch, and Michael P. Huseby taking over as CEO of Nook Media and President of Barnes & Noble, Inc., occured in the context of declining sales and profits at Nook Media.

For the first quarter of fiscal 2014, Barnes & Noble reported a decline in revenues of 8.5% , and a loss of $8.9 million (EBITDA), with the Nook division (which includes the devices, digital content and accessories), announcing $153 million in sales for the fiscal 2014 first quarter, a decline of 20.2% from the $192 million in revenue reported for the same period in fiscal 2013. (B&N press release, 20 August 2013)

With the earnings report, B&N announced also to continue support and develop its own line of tablet devices (contrary to ealier announcements - see at CNet) and to roll out at least one new reading deveice for the 2013 holiday season.

In spring 2013, has re-launched it selfpublishing platform PibIt under the new brand of Nook Press.

Earlier developments

Barnes & Noble, Inc. (NYSE: BKS) describes itself as “a Fortune 500 company, is the world’s largest bookseller and the nation’s highest-rated bookselling brand” (Statement on the company website http://www.barnesandnobleinc.com). The company’s businesses include the operation of approximately 700 specialty retail stores and more than 600 college bookstores in all 50 states in the US; online retailing through its flagship website BN.com; and a marketplace leader in the digital industry through its exploding NOOK brand of eReaders, reader’s tablets, and digital content.

In 2012, Barnes & Noble and Microsoft announced the completion of their previously announced strategic partnership in NOOK Media LLC, with an investment of $300 million by Microsoft in NOOK Media LLC at a post-money valuation of $1.7 billion in exchange for an approximately 17.6% equity stake, with Barnes & Noble owning the remaining shares. At the end of 2012, , Pearson bought a 5% stake in Nook Media by investing $89.5m in cash. (The Bookseller, 2 January 2013)

Barnes & Noble had received a $204 million investment from Liberty Media in August 2011.

In fall 2012, Barnes & Noble had brought its NOOK and digital bookstore to the UK through a new www.nook.co.uk online storefront. This marked the first time the company was expanding its business internationally.

Barnes & Noble has thereupon formed partnerships with several British retailers, including John Lewis, Dixons, Sainsbury’s, Waitrose, Blackwell’s, Foyles and Argos, to sell NOOK HD, NOOK HD+, and E Ink devices. The company has also opened its European headquarters in Luxembourg.

In October 2009, B&N had introduced its eReading device branded as NOOK, the first Android-based eReader. One year later, Barnes & Noble launched NOOK Color, the first full-color touch Reader’s Tablet. In 2011, Barnes & Noble introduced NOOK Simple Touch, a full touchscreen device, followed by NOOK Tablet. This spring, Barnes & Noble introduced NOOK Simple Touch with GlowLight, the world’s first E Ink Reader that enables reading in the dark. And in September, Barnes & Noble launched NOOK HD, the lightest and highest-resolution 7-inch tablet, and NOOK HD+, the lightest full HD tablet. The company also announced the premiere this fall of NOOK Video. Barnes & Noble has an estimated 27% market share of the U.S. ebook market and a catalog of more than 3 million titles in its NOOK Bookstore.

Google

In 2004, Google Inc. (NASDAQ: GOOG) introduced book searches of full text and, in order to increase the amount of digitized books available for such a search, an initiative to digitize significant numbers of printed books from public and university libraries. Initially named Google Book Search, Google Print, and Google Library Project, all of these activities are today combined under the label of Google Books. As of March 2012, over 20 million books have been scanned, Google reports.

As early as 2005, a controversy emerged between Google and authors’ as well as publishers’ associations and individual publishers in the US and overseas over the inclusion of “snippets” of copyrighted works. After seven years of litigation and an initial settlement rejected in 2011 by a New York court, an agreement has been reached between Google and the American Association of Publishers as of October 4, 2012. The agreement offers US publishers the option to either withdraw titles under copyright and scanned by Google in libraries, or to keep them in Google’s program and receive in return a digital copy and permission to commercially use the scan. Furthermore, users can view up to 20 percent of a title and, provided the publisher consents, purchase it through the Google Play shop. The settlement is expected to make available several million titles scanned by Google (Publishers Weekly, October 4, 2012). Related litigation between Google and several French publishers, including Hachette, Albin Michel, Flammarion Gallimard, and La Martiniere, has been settled in out-of-court agreements (Livres Hebdo, September 7, 2011).

With this settlement, the road might open up for the largest library of digitized works to be broadly and globally disseminated, including massive numbers of titles under copyright, as procedures for their legal distribution, including commercial downloads through Google, emerge. At this point, those 20 million books are maintained by the library of the Hathi Trust, a “partnership of major research institutions,” funded notably by Google. Only half of the digitized works are in English. The other half, consisting of over half a million books in German, 434,000 in French, and over 10,000 in Ukrainian, Bulgarian, or Serbian, turn this into the largest and most linguistically diverse repository of ebooks (for a detailed discussion, see “Global ebook distribution complexities,” November 28, 2012).

While Google’s ambition with regard to books started at searching and cataloging them based on a full-text search and earning revenues from customized advertising in the search results, books have started to be included in its digital multimedia distribution service, branded Google Play, which includes options for purchases via Google (or, in the case of books, various other online shops) as digital downloads as well as through third-party online platforms for ordering printed books. Google claims to have 3 million ebook titles available on Google Play, mostly free of charge, with hundreds of thousands available for purchase (http://bit.ly/T1FrMx).

Similar to the iTunes Store, however, the Google Play Store is currently available only in a limited number of countries, including Australia, Canada, Spain, Germany, Italy, South Korea, the UK, and the US. So far, Google’s policy has been to roll out book services one country at a time, often with a long interval in between (UK in September 2011, Italy in May 2012, Germany and Spain in June 2012, France in July 2012) and delays attributed to long and tedious negotiations with publishers over rights (for the example of France, see Livres Hebdo, July 18, 2012.)

In 2012, Google started to venture into the device market in cooperation with selected hardware manufacturers (in this case, Asus) by launching a tablet computer with an Android operating system, branded the Nexus 7.

In the second half of 2012, Google, together with Amazon, was challenged in a widely publicized debate, notably in the UK, over its practice of minimizing local tax payments through a complex fiscal sceme across Europe (for details, see “Google, Amazon, Starbucks are immoral and ridiculous over UK tax,” November 13, 2012).

In the US, Google had a long partnership program with the Association of American Booksellers (ABA), which it cancelled in April 2012, to expire by January 31, 2013. In the meantime, Kobo stepped in to replace Google in this regard.

Kobo

“Kobo’s greatest asset? It’s not Amazon”, wrote the British Observer in spring 2013. (The Observer, 28 April 2013.) It is true that next to paramount players who either represent the entirety, or significant portions, of the world wide web, there must be a niche open for a contender that is different, and Kobo is busy to fill out this space.

Kobo was launched in 2009 by the Canadian bookstore chain Indigo Books & Music Inc. (TSX: IDG), which was founded in 1996 by Heather Reisman and her husband and majority owner Gerry Schwartz. Kobo was at first a business division, meant to cater to the emerging ebook market, then spun off as a separate business entity, and ultimately sold to Rakuten (JASDAQ: 4755), the largest e-commerce company in Japan. Rakuten has recently seen aggressive and forceful global growth by acquiring multiple related online marketplaces, notably Buy.com (US), Priceminister (France), Ikeda (now Rakuten Brasil), Tradoria (now Rakuten Germany), and Play.com (UK), as well as an investment in the leading Russian online bookshop Ozon.ru. Rakuten has reported revenues of $4.7 billion for 2011. In 2012, and after the acquisition of Kobo, Rakuten’s head, Hiroshi Mikitani, has announced plans to confront Amazon in a competition on global e-commerce (quoted in Handelsblatt, January 22, 2012).

Kobo claims to be “one of the world’s fastest-growing ereading services.”

By late summer 2013, claims to have sold ebooks from its catalogue of 3.5 million books and magazines into 190 countries, with its devices supporting 68 languages. As of September 2013, Kobo has expanded beyond Canada, where in 2012 it controled a market share of 46%, according to Ipsos, by establishing localized platforms in Brazil, France, Germany, Indonesia, Japan, the Netherlands, Portugal, South Africa, Thailand, Taiwan, UK, and the US. Rakuten’s CEO Hiroshi Mikitani has been quoted that Kobo was the market leader for ebooks in France. (Forbes, 6 September 2012)

By January 2013, Kobo claimed to own 20 percent of the global ereader device market (Press release, January 13, 2013). 2013 has since seen two launches of new devices, in spring and in summer, which included both ereaders and tablets. (Publishers Weekly, 28 August 2013)

Other than several of its competitors, Kobo has engaged in several strategic partnerships, including with Hongkong based Cheung Kong Holdings, W H Smith in Great Britain, Whitcoulls in New Zealand, FNAC in France, and Livraria Cultura in Brazil. In many markets, Kobo is partnering with local retailers, aside from those mentioned, with Libris BLZ in the Netherlands, Libreka in Germany, and Mondadori in Italy. In Japan, it started to develop an ebook userbase ahead of Amazon, in summer 2012 (The Bookseller, August 16, 2012).

For the US, and later on also in other markets, Kobo positioned itself as an ebook partner for independent bookstores, signing respective agreements with associations (ABA in the US, and the British AB), and replacing Google in that position.

In summer 2012, Kobo also kickstarted a self-publishing portal, branded as “Kobo Writing Life.”