Amazon’s Mobipocket Strategy

Amazon.com is signaling its intent to make e-books currently licensed for the Kindle e-book reader available on a range of PDAs and smartphones.  This development — including the fact that Amazon has uncharacteristically pre-announced it, without a launch date — is as fascinating as it is ambiguous.

Before I discuss the significance of this announcement, it’s worth understanding that Amazon intends to use a technology it has owned for several years to make content available on devices other than the Kindle: the e-book platform from Mobipocket, a small French company that Amazon acquired almost four years ago.   Mobipocket created a proprietary e-book format, DRM, and reader software for a number of different smartphones and PDAs.  It also created an online store, Mobipocket.com.  

Amazon uses an enhanced version of the Mobipocket .PRC format and DRM for the Kindle.  The Mobipocket format is more of a l0west-common-denominator plain text format.

Mobipocket’s platform became fairly popular for professional (medical, engineering, etc.) and reference content.  Mobipocket.com currently offers tens of thousands of titles in all genres — though mostly self-published, small-publisher, and backlist works.

Now Amazon wants to do two things.  First, it wants to make Mobipocket-format e-books available directly on the Amazon.com site alongside Kindle-format content, instead of on Mobipocket.com.  Second, it wants to get licenses from publishers for Kindle-licensed content for the Mobipocket format and DRM.  There is several times as much Kindle content as there is on Mobipocket.com, including major publishers’ frontlist content.

The first of these is easy — it’s a straightforward engineering task.  The second may not be so easy.  Which may be why Amazon has broken with its usual policy and announced its intent to license Kindle content for Mobipocket rather than announcing actual licensing deals with publishers.  

What’s going on here?  Many questions arise:

  • Is Amazon anxious to cannibalize its own Kindle dominance by enabling the sale of e-books onto other platforms?  
  • It is looking to grow the overall e-book market by consolidating it under its own retail store now and worring about device consolidation later?  
  • Does it hope to upsell smartphone e-book readers to Kindles?  
  • Is the market dominance of the Kindle — which everyone assumes, even though Amazon will not release its sales figures — more hype than reality, given how many other e-book platforms are out there?  
  • Or is Amazon looking at an e-book revenue strategy more in terms of sales commissions from Amazon.com than from Kindle hardware sales?

Any of these are possible, but the latter rings truest.  It’s fair to say that publishers are not exactly falling over themselves agreeing to license their content to the Mobipocket platform, just as they haven’t been in the past.  Editorial execs, which hold major clout at publishing companies, may say that the Mobipocket format doesn’t look very attractive.  

But strategy execs may not like the idea of Amazon controlling so much of the economics of the e-book supply chain.  Amazon.com is, or will be, the largest of the many, many e-book retail sites — by several orders of magnitude.  That ought to scare publishers.  And that’s why I believe Amazon is pre-announcing — as a means of creating momentum among publishers to license content for the Mobipocket platform.

Amazon is betting  that its retail size advantages outweigh the consumer confusion over e-book platforms that it stands to perpetuate by diversifying from the Kindle.  Keep in mind that Mobipocket is not the only cross-device e-book format — Fictionwise’s eReader shares that distinction. 

Yet in addition to seemingly smaller players like Fictionwise, Amazon has to have two bigger fish in its competitive sights: Apple and Google.  Notice that Mobipocket supports neither iPhones nor Google Android devices.  But that’s another subject for another time.

4 comments

  1. Some factual errors in this article.

    Mobipocket is not plain text, it is actually a varient of OEB which is fairly similar to EPUB but with a different container object and a few other differences. Kindle format differs from mobi format, apparently, by only a single bit which stops the DRM from being compatible purely for marketing reasons. Therefore Kindle format is essentially identical to mobi format, not “enhanced” as suggested here.

    It is highly unlikely Amazon will launch mobi format “along side” kindle in their store. A much more plausible scenario is that amazon re-skins mobi’s mobile clients to use the kindle brand. But I admit all of this is educated speculation on my part. If this occurs the future of mobi at least in the USA is unclear. But running both mobi and kindle formats in the kindle store will just cause customer confusion and I can’t imagine them taking that course.

    IMHO Amazon pre-announced this mobile strategy because they were caught offguard by the Google 1.5 million public domain mobile announcement. They had to respond somehow to press inquiries and thus they were forced to make a very weak response “we’re working on mobile too!”

  2. OK, “plain text” was overstating the matter; what I meant was “simply formatted.” You are correct that the Mobipocket format is a variant of the old OeBF format, which in turn is just a subset of HTML.

    To settle the question of generic Mobipocket vs. Kindle formats, I spoke to Joshua Tallent of KindleFormatting.com, who happened — conveniently enough — to be presenting on this topic today at the O’Reilly TOC Conference in New York. The one thing I did get wrong is that the Kindle format is in fact identical to the generic Mobipocket format; the two are interchangeable. The Kindle does some formatting tricks that aren’t possible on mobile phones, but that’s not due to additional formatting features in the markup language; it’s done in the Kindle hardware. DRM incompatibility is a separate matter altogether.

    So, since the Kindle format is identical to generic Mobipocket, it will be possible for users to purchase e-book downloads from the Amazon site that are compatible with Kindles as well as other Mobipocket-compliant devices. That will simplify the consumer experience on Amazon.com, where I fully expect it to be consolidated. But users won’t be able to transfer the content from their mobile phones to their Kindles, or vice versa — because of the non-interoperable DRMs.

    Finally, in my view, the 1.5 million public domain book announcement from Google is not very meaningful in the publishing industry because it doesn’t involve any major-publisher frontlist (or, for that matter, midlist or backlist) titles. It’s more about the fact that Google’s e-books can be read on iPhones (and, maybe, Android devices). Your point is a good one, but the iPhone/Android aspect of it is a subject I would like to tackle separately.

  3. You are correct that the google 1.5 million is not terribly significant except perhaps for historians or researchers. Most of them appear to be nonfiction books that have been out of print for 75+ years. For example one I saw scoped out the mathematics of how to curve railroad tracks optimally for circa-1915 steam locomotives. The ones that have some commercial appeal are mainly fiction or perhaps philosophy books, but most of those have been available from project Gutenberg for years.

    But Amazon’s own catalog of purportedly 230,000 titles is also filled with irrelevant volumes with little or no commercial value. Self-published items with no quality control, vanity press, and multiple duplicate copies of the same public domain books with no value added make up a good proportion of those titles. Perhaps 80,000 of them are commercially relevant, but Amazon was playing a numbers game as part of their attempt to build a kindle mystique.

    Well, google is used to dealing in much bigger numbers than Amazon! Their very name is a gigantic number, right? Amazon has been out-smarted at their own game here and they’re scrambling to react.

  4. John Englert · ·

    I am new to this business and need some help. I am about 70 and have had a varied/valuable experience through the years on some great how-to’s that I have written short articles about. They are concise and to the point and accurate information that can be used in todays life. No fiction and/or unbeliveable information. Please someone help in the best way to publish, ebook looks inviteing and reasonable.. I do not want to spend $$$$ to get started…any suggestions appreciated.

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