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Tesco buys Mobcast for £4.5m: MyDeals.com predict an e-book war!

September 6, 2012

It was announced on Tuesday that Tescos has acquired the e-book provider Mobcast for £4.5 million ($7.15 million). Tesco has become a leading UK bookseller undercutting many of the dedicated bookstores and providing extremely competitive prices in this market.

(PRWEB) September 05, 2012

This week saw the rise of the new Amazon Kindle Fire 2 eagerly awaited and due to be launched, it is said, in September for the UK. Similarly, the debate over which tablet is the best and who will launch a new style e-reader rages on. But what of the materials that feed this new technology? It seems that choice in the e-book marketplace is limited. Amazon is currently the clear leader in the e-book market and appears to dominate without pressure from other companies but is this all about to change?

It was announced on Tuesday that Tescos has acquired the e-book provider Mobcast for £4.5 million ($7.15 million). Tesco has become a leading UK bookseller undercutting many of the dedicated bookstores and providing extremely competitive prices in this market. However, with the increase of sales in the digital market Tesco is beginning to pay attention to the shift from a printed sales market towards digital reading. Tesco already competes in the e-book market by selling the Amazon Kindle and other e-book models in store but they have taken the demands of a new digital market place very seriously. This new development sends out a huge signal to the other major digital e-books sellers.

Amazon already offers the opportunity to purchase online reading materials but have yet to allow their customers to loan books at a reduced price. In the USA Amazon do operate a ℠lending´ system but, as with the Kindle Fire release, they have been very slow at sending this opportunity across the European water. This may be a costly oversight.

Tom Packer, CEO of the global deals site MyDeals.com added, “We are seeing an interesting trend from our American visitors looking for deals on e-book lending services; this is something that hasn’t picked up in the UK at all”.

Tesco is planning to offer a similar rental system, a paid-for electronic library that will allow their customers to download a book for a fixed period of time. At the current time discussions are being held regarding the sensitive issue of agency agreements – the right to sell books less than the wholesale price. The US department of Justice successfully fought against the agreements earlier this year and reached a settlement with a number of publishers, though the fight continues. If these agreements are scrapped then the door will open for a huge cost cutting exercise in the selling of digital books. The impact will seriously affect the major organisations like Amazon and it is significant that Tesco have taken this opportunity to buy Mobcast — they are confident the changes are coming.

Readers are now actively looking for an alternative to the Amazon ℠buy as you read´ model as the prices can be prohibitive. Also, it is clear that Tesco has significant buying power and may be able to actively compete with Amazon on a global scale. Tom Packer, CEO of the global deals site MyDeals.com added, “We are seeing an interesting trend from our American visitors looking for deals on e-book lending services; this is something that hasn’t picked up in the UK at all”.

Whilst Mobcast only lists 130,000 titles, many of these books rank in the top 200 sales and make up a huge percentage of total book sales. Tesco are buying into a library of top selling books and with their existing market share, it is clear they will pick up a huge proportion of this purchase power if successful. The UK Publishers Association reported in May that digital sales increased by 366% in 2011 to £92 million.

It appears to be on the cusp of a new battle: the war of the e-books begins.

For the original version on PRWeb visit: http://www.prweb.com/releases/prweb2012/9/prweb9869607.htm


Source: prweb



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