At the London Book Fair today I spoke to Michael Tamblyn, Executive Vice President of Content, Sales and Merchandising at Kobo.
Our chat covered a number of issues, including the current retailing of the company’s ereaders here in the UK, Agency Pricing and a potential return to price competition.
Asked whether Kobo was confident it could withstand a potential price war between Amazon and Apple in the wake of US and EU action over the Agency model, Michael said:
“The advantage of our acquisition by Rakuten in January was having a large, well funded and highly profitable parent that really wants to be in this space so that has substantially increased our ability to withstand a very competitive price war.
“In the long term this is just the latest in what seems like an annual set of pricing trauma and pricing innovation that’s going on in this space right now.
“The publishers are motivated to try and create a market that has as many competitive retailers in it as possible and all the retailers want to do the best they can in terms of acquiring new customers and we’re fully confident we’re going to be able to find a balance in that that works.”
As I know it’s an issue which interests a number of readers, I also tried (and failed) to discover a little more about how Kobo’s deals with retailers work.
As you might expect, Tamblyn was unwilling to discuss the commercial terms between Kobo and outfits such as WHSmith, but stressed everyone involved had an “incentive to grow the ebook business in the UK”.
Asked whether that incentive was “one penny to every retailer” for each sale or was based on some way of tying a sale to an ereader purchased through a specific retail partner, Tamblyn told me: “we’re into the commercial terms that I can’t really speak of but we’re both motivated to make the market grow.”
