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Sony Exits From The Ebook: Will Nook Follow Soon?

Feb 6 2014, 6:10pm CST | by

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Is Sony's Exit From The Ebook: Will Nook Follow Soon?

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Sony Exits From The Ebook: Will Nook Follow Soon?

In case you didn’t notice, Sony used to sell ebooks in the U.S. and Canada. In fact, Sony was one of the first major ebook retailers and one of the first companies to manufacture and sell an e-reader here. It introduced its first e-reader to the U.S. market in 2006, a year before Amazon released the Kindle.

I say “used to,” because today the company made a deal with Canadian ebook upstart Kobo (now owned by “Amazon of Japan” Rakuten) to cede its ebook business and customers. As of March, Sony ebook customers will have their libraries transferred over to Kobo and will be buying books from Kobo if they buy them through Sony devices. Also, select Sony tablets and smartphones will come pre-loaded with the Kobo ebook app.

Sony and Kobo are both thought to be very minor players in the U.S. ebook market. I doubt the move will add too many readers to Kobo’s rolls. The company wouldn’t tell me how many accounts are being transferred but in its press release announcing the move, it claimed the same 18 million worldwide users as it has claimed in other recent announcements.

This could be a good model for Nook, which many in the publishing industry expect to be shuttered or sold before the end of 2014. Nook is Barnes & Noble’s device and ebook business and it has been faltering badly for nearly two years. While it still brings in over $100 million in revenue every quarter, it loses much more than that and revenues have been shrinking rather than growing.

The question is, who would Nook sell out to? Perhaps Apple, which has been making strides with its ebook business despite government scrutiny and very tough competition from Amazon. Or maybe even Kobo, which is small in the U.S. but bigger in many other countries and has a deep-pocketed backer in Rakuten. Microsoft has been discussed as a suitor and owns a sizable chunk of the Nook business already. Other tech giants with a stake in ebooks have been floated in publishing circles as possible suitors: Google or Samsung, perhaps. Wal-Mart has been discussed as a buyer for Barnes & Noble in its entirety.

I doubt it will be Amazon. The company has too much at stake in its larger competition with Amazon as a retailer of books and I suspect it would be a merger that would invite much antitrust scrutiny as they are the Nos. 1 and 2 booksellers in the U.S.

Related: Free Ebook — Inside Digital Book World 2014: News & Highlights

Source: Forbes


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