Walmart joins, well, most of its competitors in selling e-books

From Ars Technica:

Most Walmart stores have modest book sections, but now the company plans to expand that with digital books. Walmart announced that it’s teamed up with Japan’s Rakuten to sell e-books, audiobooks, and Rakuten’s Kobo e-readers later this year.

“We have long been a destination for entertainment including digital content—whether movies through VUDU or the digital game cards we sell in our stores,” Walmart’s statement said. “E-books and audiobooks are a great addition to our assortment. Working with Rakuten Kobo enables us to quickly and efficiently launch a full e-book and audiobook catalog on to provide our customers with additional choices alongside our assortment of physical books.”

. . . .

Customers will be able to shop for e-books and audiobooks on Walmart’s website, and the retailer will sell e-readers in its stores and online. Walmart also plans to sell “e-book cards” in its stores, which seem to be physical cards customers can buy while shopping at a Walmart store that contain a download code for access to an e-book or audiobook after they leave the store.

While digital book shopping will be done on Walmart’s platforms, customers will access purchased titles through Walmart/Kobo branded apps for desktop as well as Android and iOS. Kobo already has apps across these platforms, but it seems the two companies will make new apps for Walmart customers in the US to use. Customers with Kobo e-readers won’t have to worry about downloading new apps since all Kobo titles can be read on its own e-readers.

Link to the rest at Ars Technica

PG says competition is great for consumers, so this is a win for readers.

PG suggests that indie authors are consumers of online ebook retailing services from Amazon, Kobo, Nook (at least for a while), etc., so he thinks competition for Amazon is a win for indie authors as well. Walmart will turn more readers onto ebooks sooner than would have been the case if it had continued its paperback and gossip mag ways.

In some large metropolitan areas, the Walmart customer has a bad image. You can even find websites with photos of gross people. However, in many small and medium-sized communities, Walmart is by far the best place to buy groceries and get your prescriptions refilled. The doctors and spouses in these communities, lawyers and spouses, business owners and spouses, etc., shop at Walmart because it’s better than driving an hour to find another retailer that offers the same range of goods.

So far, Amazon hasn’t tried any “screw your partner” strategies that are so attractive to many other large companies, but if Walmart is serious about competing with Amazon in the ebook market, that’s some insurance for authors that Amazon will continue its virtuous treatment of authors.

(As an aside, PG thinks as long as Bezos is running things, Amazon will continue these practices. He’s worried about what happens to Amazon when Bezos rides one of his rockets into retirement and someone else takes over. The successor to a highly-successful and dominant CEO has no guarantee of being able to ride the momentum of the prior star to continued success. See Tim Cook and Marissa Mayer, for example.)

30 thoughts on “Walmart joins, well, most of its competitors in selling e-books”

    • Me, too. I’m also glad I made the decision to take my books out of Select last month. Otherwise, I’d be agonizing over whether now is the time to go wide or not.

      Between this and the new push by Apple to compete with Amazon, I think 2018 is going to be a very interesting year.

  1. That’s three reported moves in one week, from Google, Apple, and Kobo/Walmart, to compete in ebooks and digital audiobooks.

    Great news…
    …that would actually have made a *big* difference in 2012-13 during peak ebook adoption.

    Now, it could be the BPHs have passed out the word they intend to stop pricing their ebooks higher than print or get rid of agency, but otherwise I see no big change in the competitive landscape. Kobo’s mindshare is still minimal, Google’s audiobook app is user hostile…

    …and Apple’s big move isn’t really that big. It’s an app refresh and rebrand. They still only support their own hardware and still aren’t even trying to reach readers on other platforms. In contrast to iTunes during it’s early days, under Jobs, to tap the Windows installed base.

    I think some folks in the publishing establishment (Bloomberg, et al) are projecting their hopes and dreams without stepping back and taking in the relative positions of the players.

    Of the three moves, Kobo’s is the one most likely to move the needle measurably, but only because of Kobo’s previous invisibility outside the enthusiast community. Going from near zero presence to Walmart support has to add at least 50% to their sales, right?
    They may end up with…5% share?

    Let’s not get carried away, okay? 😉

  2. I wonder if it would be better to have books direct to Kobo, or if going through D2D would hamper getting into Walmart in any way?

    I’m just hoping things are going to start heating up competition with Amazon. It’s long past due. I’m not holding my breath, though. Been burned before.

    • I was just reading in David Gaughran’s 3rd edition of Let’s Get Digital that some of the places to which Rakuten distributes require ISBN numbers. Which means that ebooks possessing only the Kobo ID number (and lacking an actual ISBN) don’t go to those sites.

      I’m wondering if Walmart will require ISBNs. My ebooks do not have them.

      • I’m hoping that any book listed on Kobo will go. I don’t have ISBNs either, unless they’re free ones, and no money to invest in that right now.

        I’m hoping the latest news means more push from other companies so we can sell books better anywhere. We really need good marketplaces, not just Amazon.

  3. Not interested. Walmart has a long history of demanding sellers sell their wares at Walmart’s ‘lower’ price points, too bad in this case the others will simply price match.

  4. I’m excited for this. I distribute directly through Kobo but since I’m in Canada, I get free ISBN’s so I use them as I know some places require them. Looking forward to all this new stuff!

  5. I’m all for competition in ebook distribution. Unlike PG, I believe Amazon is already screwing authors. Not as much or in the same ways as traditional publishers, but Amazon is reaping huge profits from authors. They charge dollars for a service that I am willing to bet costs them less than pennies. If Amazon had to compete for authors of ebooks, the market would wring out the excess profit and authors would get closer to 90% of the purchase price instead of 70% or less. I hope that Walmart will figure out that they can maximize their profits and disrupt Amazon’s business by charging authors less or providing authors with more.

    I look at authorship like I used to look at the software business. The cost of software is in development, stabilization, and support. The marginal cost of online distribution is so low it is hard for the accountants to quantify it. That marginal cost is what Amazon charges authors for. What merchandising Amazon does is not very effective, as authors who place books on KDP without building their customer base themselves can tell you.

    Amazon certainly has helped independent authors, but authors pay a lot for services that costs Amazon very little.

    Ebook authorship is a mug’s game. We invest weeks and months into writing. We pay editors and designers. We torture ourselves to build a customer base. Amazon’s contribution per ebook is measured in milliseconds of compute time.

    The question, of course, is not whether Amazon deserves their 30%. Rather, can somebody else make a profitable business of the service Amazon now provides for less than 30% and force Amazon to compete? Will Walmart be the one? We’ll see.

    • Not as much or in the same ways as traditional publishers, but Amazon is reaping huge profits from authors.<

      Authors are reaping huge profits from Amazon.

      This is easy to test at home. An author can simply remove his books form Amazon and sell them himself. The difference between what he makes from Amazon, and what he makes on his own is the value of Amazon’s participation.

      And competition? The reason nobody competes for authors is because they don’t have to. There are so many authors competing with each other, nobody has to bid up for them. Walmart won’t compete for authors because they also don’t have to.

      Nobody cares how much work authors do. Nobody cares about their torture. All they care about is the final product and what consumers will pay for it. Consumers don’t care either. It’s just like widgets.

      God Bess the free market.

          • And you don’t even have to wait that long. You can ask them to remove you sooner and they will. I just did and my books were only 2 weeks into a new 90 day term.

            • Yes I have done the same thing. I had a month to go and I asked to have taken it out and it was out the next day so the 90 days are written in stone per say, you can have it taken out.

        • Any author who sells a book on Amazon benefits. He accesses an extremely efficient and effective worldwide distribution system. We might ask why an author would bother placing a book on Amazon if he didn’t benefit.

          I’m driving around in my benefit. I don’t consider it a huge profit, but it is a very substantial benefit.

        • If the wannabe writer sells one ebook (by their mom or a friend), then they are already ahead of the writer that had to wait half a year or longer just to receive a rejection slip from a publisher.

          (For this exercise we are just considering profits and anything at all beats zero … 😉 )

      • Terrence– I look at Amazon from the opposite direction. I am paying Amazon a 30% cut on my book sales for the service they provide me. The KDP service is a widget I purchase for my business of producing book widgets for a profit. I use KDP to profit from my investment in my book. But KDP is just a widget. I’m always ready for a better widget at a better price.

        Amazon’s KDP widget is desirable, but I think they over price and under deliver. Walmart or some other competitor might do better on both counts. Admittedly, Walmart’s online presence is kind of lame now, but Walmart is a competitor if they are anything. Who knows where that spirit of competition will take them.

        At the moment Amazon doesn’t have any strong competitors, although Joanna Penne makes a good point that there are emerging book markets that Amazon does not compete in well.

        You are right that book buyers don’t care about my investment, but they do care about the fitness of my books for their purposes. If I am a good author, I invest in ways that increase the fitness of my book and therefore make buyers willing to pay more. If I am a poor author, I may invest just as much, but if the investment doesn’t pay off in increased fitness, them’s the breaks. In that sense, my investment matters to the book buyer, but only as it is manifest in a book of greater value to them.

        One of the interesting aspects of digitization is it turns services into commodities. Uber separates car services from cars. Amazon separated retail from stores. KDP separates publishing from book distribution. As authors, we can take advantage of that separation and shop for the best service.

        Your experiment with withdrawing from Amazon is interesting. I have been thinking about trying it. It looks to me as if I could sell books directly for less than 10% of each retail sale. The question is then whether I can market directly effectively enough to beat Amazon. So far, I see that my own feeble marketing efforts are more effective than Amazon’s, so there is not much add there.

        This business is interesting.

        • Consumers care about the product, not the production process.

          They don’t care if the author spent a day writing the book, or agonized for ten years. They don’t care if he hired an editor. They don’t care if he used Scrivener. They don’t care if he uses Windows 10 or Linux. They don’t care if he outlines. They don’t care why he wrote it. They don’t care if he writes bad checks. All they care about is the final product. Just like all the other consumer products they buy.

          I don’t doubt you can pocket 90% retail price for each unit. That’s easy. The value of Amazon isn’t in the ratio of market cost to retail. It’s in the volume of sales. 90% of ten sales at $5 doesn’t compare well to 70% of 100 sales. But, this is where the at home experiment will prove valuable. Best of luck.

          And who is paying who? Who here sent Amazon a 1099?

          • I agree. If authors invest in their product and do not realize an increase in value to buyers, they made a bad business choice. Nevertheless, good investments result in a more valued product. That’s the essence of the author business: produce books that induce readers to pay more.

            My point regarding Amazon is that for many authors, Amazon does not generate sufficient volume to justify the exorbitant price for their puny service. Authors should drop the scales from their eyes and look at the numbers. If you sell 10,000 copies a month through Amazon, cool. But look at the numbers. Amazon volume marketing may not be adding value to your business in return for their exorbitant distribution charges. A competitive distribution service might add more.

            • If an author can make more total profit without Amazon, it’s rational to leave Amazon.

              But that is a function of totals, not unit retail price and unit costs. It’s certainly a partial function of unit prices and costs, but we can’t make a rational decision knowing only unit data.

              Is it better to choose an option where the author gets 99% of sales price, or 50% of sales price? I don’t know. It depends on units sold and retail price.

    • So far, nobody is stepping up to go to even 25%.

      It may be they remember what happened the last time somebody tried to undercut Amazon in the ebook business. (B&N and the 4 hour price war.) And then there’s the pbook price war of 2009.

      It is pretty well understood that Amazon will defend its position from pricing attacks. Given their scale and efficiencies they don’t have to compete on price because there’s nothing to gain for competitors: cutting margin isn’t likely to increase volume enough to offset the lost revenue.

      If Amazon is going to be dislodged it won’t be by something as simplistic as lower distribution fees. Yes, there was a time when Indies would switch from Kindle to other channels, or at least go wide. But those times are past.

      Kindle sells around 80% of all ebooks sold in the largest more mature markets. And, then, on top of it, they pay out over $20M a month in KU payouts. Which happens to be more than the gross sales volume of all competitors not named Apple, possibly combined.

      To dislodge Amazon is going to take brains and tech, a whole new business model that disrupts discrete file sales and the tyranny of the installed base. The best candidate would be ebook subscriptions. Unfortunately for competitors, Amazon got there “firstest with the mostest”.

      For now, Amazon has the Cold Equations on their side.

    • The question, of course, is not whether Amazon deserves their 30%.

      If they provide enough value, then they can charge for that value even if it did not cost them as much as they charge. That’s called making a profit.

  6. Walmart is finally using Amazon’s tactic to get people to their website. I rarely browse on Walmart’s site. I might go there for one specific item to compare it in price to Amazon, but that’s it. I imagine others are the same. Walmart’s website is not fun or interesting. It’s bland and boring. Books liven things up because you never know when you’ll find something good. Books bring people to browse for something to read, and while there, maybe pick up a few other items.

    I remember the days when my boys were young and I rarely had time to go to a bookstore, but when we’d go to Walmart (which was less often then because they didn’t sell groceries then) I would eagerly have my husband take the boys to the toy aisle or whatever, so I could spend ten minutes or so browsing the paperbacks.

    • Walmart’s website is not fun or interesting. It’s bland and boring.

      Could be. But their prices for tools are very competitive with Amazon. Walmart often has a lower price than Amazon.

      • Sometimes, but shipping isn’t free unless you hit a certain amount, and the ‘pick it up free in the store’ has zero appeal. The whole reason I want to order online is because I don’t want to go to the store! lol

  7. Somehow the idea of buying an ebook from Walmart just seems wrong or unnatural, or untrustworthy, like I might be throwing my money away because they might abruptly stop selling them, causing me to lose all the books I brought from them. Why would anyone bother with Walmart? I shop there all the time, but for ebooks? Just go to Amazon, Nook or Kobo. Or Apple. When I think of places I might consider buying an ebook, Walmart comes in dead last.

    • Just go to Amazon, Nook or Kobo. Or Apple.

      Nook? B&N is on lots thinner ice than Walmart. Any ideas on what happens to those Nook books consumers bought if B&N goes down?

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