Over the last few months we’ve heard about the onslaught of tablets hitting the market like Google’s just-released Nexus 7 tablet, Samsung’s Galaxy Note 2 phone/tablet hybrid, Microsoft’s Surface tablet, Amazon’s new Kindle Fire and maybe even an iPad Mini.
In its first releases since being acquired last year by Japanese retailer Rakutan, Canadian-bred e-reader and e-book company Kobo has unveiled its latest line-up of devices. They include a 5″ Kobo Mini and a new version of its popular Touch e-reader that allows you to read in the dark. But the toy that will raise the most eyebrows is the Kobo Arc, an Android-powered 7″ HD tablet due out in November, that’s taking aim at the same market targeted by Amazon’s Kindle Fire.
I spoke to Kobo CEO Mike Serbinis about the Arc, how he expects it to compete in the cutthroat world of tablets and how the company has fared in its first year under Rakutan.
Canadian Business: Kobo’s first swing at a tablet was last year’s Vox. What are the biggest differences between the Arc and the Vox? What were some lessons you learned from that release?
Serbinis: [The difference is] the Arc is something Kobo has designed from the ground up. Every aspect—from its industrial design, its electronics, its software—has been developed by Kobo’s team. It’s Kobo’s innovation from the ground up. As a young start-up getting into electronic devices, in the past we’ve relied on other partners in certain areas for components. Here, this is Kobo from the ground up. So from a quality standpoint, it’s taking all the great things we learned from Kobo Touch and how we designed that and applying it to a different form.
For the software, we focused on creating a unique experience to help people discover content. You could be reading the Steve Jobs book and you could pin it to a Tapestry—[Kobo's custom Android OS] which works like a combination of Pinterest/Kobo—and you might get a suggestion to check out the Beatles White Album, which he references in the book. So you can get these cross-media references, whether it’s a movie talked about in a book, a movie based on a book, music referencing a book or vice-versa. You could pin a New York Times obituary of Neil Armstrong and Arc could suggest the NASA TV website, books on the moon landing or even a Facebook fanpage on Armstrong.
CB: What is the biggest differentiator between the Arc and its increasing number of competitors?
Serbinis: There are two price points for the Arc, $199 for an 8 GB version and $249 for a 16 GB version. And you’re right, there is a lot of noise in terms of what might be coming out and what has come out. Of course, last year we saw a plethora of tablets come out and try to be the all-singing, all-dancing tablet. We’re not trying to do that. We’re not trying to build the best universal computing device in the world. We’re betting on book lovers and building an experience that will be the best for them when it comes to content discovery, the actual reading experience, the entertainment experience outside of reading. That’s what we focused on.
CB: It can’t hurt that the bulk of content bells and whistles for Amazon’s Kindle Fire aren’t available outside the U.S.
Serbinis: That’s another differentiator between Kobo and its competitors. In the early days we were criticized for looking beyond Canada and selling devices around the world. As a result, we have customers buying e-books in more than 190 countries, partners carrying the devices in more than 12 countries, when they start hitting shelves in early November.
CB: How has the first year with Rakutan been going?
Serbinis: It’s been eight months and 20 days since the transaction closed, but who’s counting? All in all, I’d give it an A+ grade. There’s always challenges. To access all these benefits, you have to learn how to work with each other. Over the 13-hour time zone difference, that can be challenging. But between video conferencing and launching in Japan, things are working very well. We’re a primary growth strategy for them. We can get into countries faster than they can with our partnership model and it’s a model that they buy into. That’s perhaps the biggest difference between Rakutan and Amazon, that Rakutan empowers merchants whereas Amazon tries to compete with them. So that’s very simpatico with our philosophy of partnering, breathing freely and having an open platform. So it’s been going great.