If you’re holding on for a price cut to the Australasian version of the Kobo eReader, prepare to be disappointed.
What?! But wait – isn’t there an eReader price war going on? Yes there is – overseas. The Kindle 2 and Nook have both added features and offered substantial price cuts, but Borders management say that the Kobo eReader won’t be following suit, at least not on a permanent basis.
Kobo eReader supply dramas
Mooching around the Australian Booksellers Association Conference & Trade Exhibition shindig at the Brisbane Hilton yesterday, I ran into REDgroup Retail’s Group Communications Manager Malcolm Neil.
Why do you care? Because REDgroup runs bookstore chains Borders in Australia, and Whitcoulls in Kiwiland, and therefore ebook sites www.borders.com.au and www.whitcoulls.co.nz. And they both sell ebooks via the Kobo eReader and its apps. The eReader costs $A199 in Oz and a more hefty $NZ295 ($A240) in New Zealand.
The Kobo hardware has been a huge hit in New Zealand, selling out and giving Whitcoulls and Borders more than a few supply headaches, says Neil. But supply is pretty much up to speed again, so everyone in Australasia who wants one should be able to get one now, he says.
“It was a bit of a learning experience for us,” says Neil. “We definitely had supply chain issues for about four weeks there.” He says REDgroup wanted to keep the Kobo rollout process transparent, but acknowledges that “when you promise people something, then don’t deliver, they get upset – we know that.
“We were told we were getting flamed on [Australian forum network] Whirlpool, so we got on the forum and tried to keep people up to date. We wanted to keep the Kobo rollout process as transparent as we could.”
Quite right, too. Most of us would agree that keeping consumers informed is paramount. Massive demand is a pretty good problem to have – obviously people want the product – and I think retailers often underestimate how lenient and understanding the public can be, as long as they are kept informed. Listening to this, Stevie J?
Kobo eReader price
I put it to Mr Neil that with the Kindle 2 now at $US189, the Kobo hasn’t got a lot of headroom left in the ereader market. The Kindle is a tad more, but boats the convenience of the free Whispernet 3G link. Funnily enough, Neil knew the Kindle price in local currency to the dollar at yesterday’s exchange rate.
“With shipping, it’s about $50 more now, so it’s getting very close,” he said. So why doesn’t REDgroup just cut the price? “The margin on the product is very thin as it is. We’re not prepared to make a loss on it to sell books right now,” he said. “Although I won’t rule that out around Christmastime.”
So, folks, if you want a Kobo eReader, buy now. You could hold out for a possible pre-post-Christmas discount sweet spot, but at the moment that looks a 50/50 proposition at the very best. I’m not sure if this is also the Borders policy in the US, where the Kobo eReader sells for $US149. It would be easy to assume that it is, given that they’ve rolled out (or are rolling out) the same reader, software, apps, and software upgrade.
Kobo firmware upgrade
If you’ve read my review of the Kobo eReader, there’s also video if you like, the slow startup time and a font issue were my only problems. Enter Cameron Drew, Kobo’s man-on-the-ground in Australasia – the guy in charge of ensuring the Canadian company’s hardware and software fits seamlessly with local ebook vendors’ sites and content. He was also at the ABA conference, and had a few stories to tell about the hardware/software trials and tribulations that Kobo has had as a global ebook pioneer. They’re very upfront about it too – you can read more about their journey on the Kobo blog here. It’s nice to see them being very transparent about the process.
We ran through my review gripes and some other minor issues, with Drew saying that they’ve all been fixed in the new firmware upgrade. A few LED charging/standby colour issues were another major other change, but I’m sure there are other bug fixes.
I’ve yet to get this new software and load it onto my Kobo, but I’ll certainly review the changes here when I do.
Editor’s Note: the above is reprinted, with permission, from Jason Davis’ Bookbee site. PB
I wonder if ebook geo-restrictions are going to provide enough “cover” for the second tier readers to maintain higher prices indefinitely.
Ripples do dampen with distance. 😉
I don’t see the need for Kobo to drop the price in markets like Australia and New Zealand (or Canada) so long as the alternatives are more expensive, harder to buy or have poorer range of content to purchase. When the sales slow down, then maybe chip away at the price — $129 vs $149. But tantamount now is to get devices into eager hands, not marginal ones, and get them involved in the Kobo book buying experience.
Kobo got off to a bit of a shakey start in terms of software performance but, at least in Canada, that has been fixed “completely”. The company has also shown it is responsive in public forums. To the extent this policy is mimicked in all markets, its good for the brand.