Cooperative Business and the Kobo

On Thursday, I attended my first live author event at Annie’s Book Stop in Plainville, MA. Of course, as an aspiring author, I don’t appear on anyone’s radar. So, it was more of an educational opportunity for me to go and get an idea of the dynamics of what might or should go on at such events.

 I got a better education out of it than I expected.

Ann, the owner of Annie’s Book Stop in Plainville, is a friend of mine. Her bookstore is the prototypical small bookstore. New and used titles sold side by side, avid readers coming in at any time of the day to pick out their next read. Her store has survived the arrival of the megachain bookstores and has outlived at least two, Walden Books and Borders.

Annie’s Book Stop has thrived because Ann has eschewed the luddite attitudes of some of her peers—some of whom don’t even accept credit cards as payment. While maintaining the feel of a local bookstore, she has kept a careful eye on the book market and the trends that come and go. One of those trends was the coming of the ebook.

Many have touted the coming of the ebook as the end of the independent book seller.

Amazon.com can be credited with really giving ebooks their opportunity to finally get a foothold in the market. While ebooks have been around for many years, it wasn’t until Amazon.com made a go of it by bringing a reliable ebook reader to market and giving it a true and broad library for reading that ebooks finally were accepted by consumers.

But Amazon.com has also been considered by many to be the enemy of the independent bookseller. Cutting prices to often less than wholesale, Amazon has forced prices to the point where many small booksellers simply can not compete. Amazon’s Kindle ebook reader used a proprietary format which could only be purchased through Amazon.com. This effectively locked out any direct competition. This also meant that libraries built up by consumers would not be compatible with other ebook readers, negating any chance that a better ebook reader could lure readers from the Kindle platform.

Barnes & Noble stepped into the ebook market in 2009 with the Nook. Where Amazon’s Kindle used a proprietary format, the B&N Nook focused on the EPUB file format for ebooks, an open format developed by an approved standards association, the International Digital Publishing Forum (IDPF). The Nook represented the first real competition to Amazon’s Kindle.

Then, in 2010, Apple entered the fray with the iPad, a tablet computer as opposed to a dedicated ebook reader. Rather than go the proprietary file route, Apple chose to adopt the EPUB file as its native ebook format for the iPad.

These three platforms became dominant in the ebook market.

Amazon aggressively tried to corner the market by locking customers into their platform. Ebooks from B&N and Apple, both using EPUB files, meant that an ebook purchased from one would work on the other. That is, so long as Digital Rights Management (DRM) hasn’t been implemented on the given EPUB file in question. Apple, has merely used ebooks as a lure to get customers to purchase the iPad, and seems to have no interest in creating a monopoly. Apple has encouraged producers and publishers not to use DRM, even though it is an option.

Either, way, locking customers into a platform using DRM or proprietary formats means that those customers would only be able to purchase their books from a given and controlled source. It also locked independent booksellers out of the competition.

Then, enter the Kobo…

The Kobo is an alternative ebook reader. It uses the same screen as the Kindle. So the visible quality of the text is equal to the Kindle series.

Rather than trying to lock customers into their platform, Kobo Inc. decided to take a different path. They decided to follow a cooperative business model.

And this is where Annie’s Book Stop comes into the picture.

While Amazon and Barnes & Noble, and to some degree Apple, are pretty much closed eco-systems in ebook sales, Kobo opened the door for independent booksellers to sell ebooks.

Kobo created a program so independent booksellers could connect to the Kobo library to sell an ebook. Of personal importance to me, the independent bookseller gains a profit from an ebook purchased from Kobo through the independent bookseller’s site. This, instead of creating a walled-garden approach to selling ebooks. Kobo has decided to share the wealth with independent booksellers. I get the impression that it isn’t a large percentage of the sale price, but it is something. This is unlike the other ebook retailers, who basically leave independent booksellers out in the cold.

This gave Ann the opportunity to have her little bookstore tap into the potential of ebook sales and move her business into the 21^st century. Thusly, Kobo has given independent booksellers a way to remain relevant in the modern book selling markets.

For this reason, if asked what ebook reader would I recommend, I would say the Kobo. Instead of trying to corner the market and squeeze everyone else out, they are creating the opportunity for others to enter the market.

So, I recommend if you are using an ebook reader or tablet computer that can render EPUB files, you should consider buying that ebook through one of the independent booksellers that are partnered with Kobo. This way, the independent booksellers have a chance to make money off the ebook market. Ann invested in creating a web site so her store could do just that.

Look around your local area for an independent bookstore and ask if they are selling ebooks via Kobo. It does mean they may need to set up a web site. But it is a good way to help support local and independent bookstores that otherwise may be left in the dust of the ebook revolution.