Tech

Rival warns Kindle will fail in China

By Chen Limin (China Daily)
Updated: 2010-10-27 08:12

BEIJING - The chief executive of Shanda Literature Ltd - an online literature subsidiary of the Chinese Internet company, Shanda Interactive Entertainment - warned on Tuesday that Amazon.com Inc's Kindle is unlikely to grab a significant market share in China.

Hou Xiaoqiang said rampant piracy, fierce competition from copycat products and the lack of support from domestic publishers will hamper the success of Amazon's e-book reader.

"I don't think Kindle will do a good job if it enters China," said Hou, at the Beijing launch of his company's own e-book reader, Bambook.

He said that Amazon owns digital copyrights of a large number of books, and it generates much of its revenue by charging commission on book sales, but added that because Amazon's Chinese branch is simply an online distributor, it doesn't bring the advantages that accrue from gathering content, which is often seen as the key to attracting users.

Earlier reports in the Chinese media said that Amazon planned to introduce Kindle to China, claims which have been denied by the United States-based online retailer.

Wang Hanhua, president of the Chinese division, Amazon.cn, told China Daily in an earlier interview that the company would be extremely wary of introducing Kindle to the market.

"China's publishing sector hasn't been aware of the importance of digital copyrights until very recently, and many publishing houses have concerns over the digitalization of their books," he said.

He added that the company is still examining the market and does not have a timetable for the product's launch.

Despite Amazon's reluctance to introduce the product, many Chinese players have already taken the step. Technology companies, including Hanwang, Founder and Shanda, have launched e-book readers in China - most of them are backed by domestic content vendors and are available at a lower price than Kindle.

According to the IT research firm, DisplaySearch, e-reader sales in China will soar from 800,000 units in 2009 to 3 million units this year, accounting for about 20 percent of global sales.

Gu Wenjun, an analyst with the research firm iSuppli said that publishing houses, latecomers in the market, will see strong performances if they form alliances and provide the wide range of content that customers demand.

Shanda said that its online bookstore, which launched earlier, now provides more than three million e-books, some of which the company owns the copyrights to.

The company on Tuesday also said it will start developing a new search engine that allows users to search for authentic e-books on the Internet.

China Daily