Rakuten comes out with 8,000-yen e-book reader

July 03, 2012


Rakuten Inc.’s new e-book reader will cost 7,980 yen ($100), less than half of the price of its major competitors, while books for the device will be free from the consumption tax, the company said.

The Kobo Touch reader, developed by a Canadian company that Rakuten acquired in January, will go on sale in Japan on July 19.

The 1-centimeter thick reader weighs 185 grams and can connect to the Internet through wireless LAN. Black-and-white E Ink will be used for the display, and the reader can be used for about a month on a single charge, Rakuten said.

The Kobo Touch had been sold in North America for $99. Rakuten said it can offer the lower price in Japan because of the strong yen. By comparison, the Sony Reader, which has similar data communications functions, costs 16,800 yen.

"We will not be able to generate huge profits through the sale of the reader,” Hiroshi Mikitani, Rakuten chairman and CEO, said at a news conference on July 2. “We set the price so that people could easily buy it as a way of expanding the market."

Rakuten said the consumption tax will not be added to the price of titles purchased for the Kobo Touch because an overseas subsidiary will handle its e-book sales. However, the Finance Ministry said it plans to impose the sales tax on e-books sold in Japan by foreign companies.

Mikitani said the company would follow the new rules if the Finance Ministry revises the law.

Rakuten will open Kobo E-book Store to sell e-books in Japan, starting with only about 30,000 Japanese titles, fewer than its rivals. It plans to offer 100,000 titles by the end of the year and eventually 1.5 million titles.

Those books can be bought not only through the Kobo Touch reader, but also on most smartphones and tablet computers, the company said.

Amazon.com is also preparing to sell a Japanese-language Kindle reader in a market that is expected to further expand.

According to research company Impress R&D, sales of e-books for new devices, such as smartphones and tablet computers, reached 11.2 billion yen in fiscal 2011, an increase of about 4.7 times over the previous year.

Overall e-book sales, including those for older devices, such as mobile phones, totaled about 62.9 billion yen, a decrease of about 2.1 billion yen. The decline was caused mainly by the plunge of approximately 9.2 billion yen in sales over the previous fiscal year of e-books for mobile phones.

In fiscal 2011, e-books for mobile phones accounted for 76 percent of the total. Manga and adult content have been the major sales items for mobile phones, but the newer devices are expected to center on literary works.

"While there has been a sharp increase in the number of smartphone users, the transition of contents bound for mobile phones to the newer devices has not been smooth," an official with Impress R&D said.

By fiscal 2013, sales of e-books for newer devices are expected to exceed those for mobile phones. Impress R&D estimates the overall e-book market will swell to 94 billion yen.

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Rakuten Chairman Hiroshi Mikitani shows off a Kobo Touch reader on July 2. (Junichiro Nagasaki)

Rakuten Chairman Hiroshi Mikitani shows off a Kobo Touch reader on July 2. (Junichiro Nagasaki)

  • Rakuten Chairman Hiroshi Mikitani shows off a Kobo Touch reader on July 2. (Junichiro Nagasaki)

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