Technology

Will Kobo's Vox be silenced?

With its new tablet, the e-reading company is fighting on enemy territory.

(Photo: Natalie Castellino)

Kobo’s march into the tablet wars with the Vox, touting a colour screen and running Google’s Android operating system and apps, is a move it was forced to make—regardless of whether it proves good strategy.

With a library of more than 2.2 million e-books, with five million customers in 100 countries so far, the Toronto-based e-book retailer has shown potential to build itself into Amazon’s chief global rival for digital reading, concentrating on markets like Europe where the American company isn’t as strong. But with the introduction of the Vox, Kobo is suddenly up against every mega-tech company in the world that’s after a piece of the hot tablet market.

Kobo chief executive Michael Serbinis says the move is deliberate. After all, a device with a colour screen—rather than the monochrome e-ink readers Kobo has been selling so far—opens up a wider market. “The whole e-book universe has up until now been largely books that are text or black and white,” he says. “That really leaves out a lot of categories: comics, kids books, cookbooks, travel guides.”

That’s true—but it also drags the Canadian upstart into direct competition against several bigger and better-resourced tech mammoths, rather than just one.

The problem for Kobo, which started in 2009 as a joint venture between a number of international booksellers led by Indigo Books & Music, is that the market for e-books has shifted quickly.

The company launched its first dedicated e-reader in May 2010, a month after the original iPad. Apple began as a dabbler in e-books, but the iPad’s runaway success has made it a player. It’s also changed the mass market’s expectations for their reading devices. It’s no longer about e-ink versus LCD screens—the more important questions are: Does it do e-mail? Does it play movies?

Amazon responded to the shift with the September announcement of its Kindle Fire. Like the Vox, it’s priced under $200, runs Android and plays movies and music. By capability, the Fire, Vox and iPad aren’t so different.

But, as analysts have pointed out, it’s not the device that matters, it’s the platform behind it. In that sense, Apple and Amazon have big advantages over Kobo because of their proprietary digital media stores—not to mention the power of their brands. Kobo, meanwhile, is left scrambling to find partners like cloud music provider Rdio to provide media other than books. The company is still working on a deal to bring TV and movies to the Vox.

For his part, Serbinis says he isn’t concerned about having to go up against two—or possibly more—tech titans. “We’ve always been the David among many Goliaths,” he says. “That’s not something to be scared about.”

It is, though. With the e-book market shifting to tablets, Kobo is being dragged outside its core competency—providing a pure e-reading experience—and being forced to compete with the all-singing, all-dancing big-name tablets. That’s a scary proposition in a competitive market.

And it risks making Kobo one of many also-rans in a larger, brutal war against tech’s big boys.

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