Why ebooks in Quebec are a taxing issue

While NPR urges the world to stop the ebook versus print debate, in Quebec, the debate has shifted to how digital titles are taxed, and what constitutes a “real book.”

According to Montreal’s The Gazette, the Quebec government has treated print books as zero-rated for tax purposes since 1996, but ebook sales can still include the 9.5 per cent provincial sales tax.

Robert Hayashi, CEO of the digital publishing advocacy organization eBound Canada, disagrees with the discrepancy. “Just like there is a hardcover (print book) format and a softcover format, ebooks are just another format,” he told the The Gazette. “So if government is not taxing the hardcover book, we believe that government should also not tax the ebook.”

In another Gazette article, Kobo’s vice-president of finance, Daniel Budlovsky, lamented that Quebec consumers who purchase ebooks through Kobo are charged both provincial and federal sales taxes, while those who buy their ebooks through U.S. competitor Amazon pay no sales taxes.

Although Budlovsky said the discrepancy “should be atrociously viewed by the Canadian public,” Kobo isn’t ready to battle the Canadian government to change the tax laws.

“We accept the law for what it is and feel that it should be changed but that is a long and bureaucratic process,” Budlovsky said. “We work in a … fast-moving industry where we need to stay ahead of the competition by working on things that are under our control.”

Kobo issues statement about Borders liquidation

Kobo, the Toronto-based e-reading company, has issued an official statement to clarify its position vis-à-vis the recent announcement that the U.S. bookstore chain Borders would be entering liquidation. The statement is in response to “misconceptions about Kobo that have been inaccurately reported by the media and misunderstood by consumers.”

The Borders liquidation is of particular concern to Kobo, since the bookstore chain was an early investor in the e-reading company, with an 11 per cent stake. According to the statement issued today yesterday, “Borders shares are subject to the terms of the Kobo shareholders’ agreement which, among other things, restricts their transfer or disposition.” On Monday, Bloomberg reported that Kobo was one of several creditors to file objections to Borders’ liquidation process in U.S. bankruptcy court.

Where customer service is concerned, Kobo asserts that for some time it has been working to transition Borders’ customers’ e-book accounts to Kobo and will continue to do so.

The Kobo statement quotes CEO Michael Serbinis:

Borders has a minority stake in our company and serves as part of our distribution in the U.S. along with Walmart, Best Buy, Sears, and other leading retailers. As a member of the broader book publishing and retailing community, we are watching Borders’ story and will offer our support to Borders and their employees. Kobo will continue to serve Borders customers – in this time of transition as well as moving forward – to provide the ultimate eReading experience and one of the widest selection of eBooks available to the eReading community worldwide.

Book links round-up: Google launches e-reading device, Amazon asks for voter referendum, and more

• Google eBooks launches e-reading device, available only at U.S. Target stores
• Amazon asks for California voter referendum, hoping to overturn sales-tax collection law
• Penguin Classics book covers as Band-Aids
• Share that unfinished novel (and reasons/excuses) with the world

Book links round-up: Google’s eBookstore, e-mail woes, Q&A with Chester Brown, and more

• Chasing the story behind the story: exploring literary journalism
• The nominees for the inaugural Independent Booksellers’ Choice Awards
• Is the eBookstore worth it for Google?
• Crime writer Robert Rotenberg goes to town on e-mail
• Graphic novelist Chester Brown discusses why he has no problem with Paying for It
• Amazon selling more e-books than printed titles
• The unique world of Zsuzsi Gartner

Borders on the brink, but Kobo continues to grow

A year ago, in the week following Christmas, Canadian publishers and distributors were greeted with the dismaying news that one of the country’s leading bookstore chains, McNally Robinson Booksellers, was significantly scaling back its operations, closing down locations in Toronto and Saskatoon Winnipeg. This year, a retail shakeup on an even bigger scale is taking place in the U.S., where the future of the bookselling chain Borders, which operates 676 bookstores across the U.S., is in question.

Late last week, the Ann Arbor, Michigan–based chain announced it is delaying payments to some of its vendors in an attempt to restructure its debt. The news set off investor panic, resulting in the company’s share price falling by 22 per cent on Friday.

Now, The Wall Street Journal is reporting that at least one major vendor, Rowman & Littlefield Publishing Group (which owns the distributor National Book Network) has temporarily suspended shipments to the retail chain. Other publishing companies, including Hachette Book Group and Sourcebooks, are also reported to be considering similar options. From the WSJ:

“When a customer of that size calls you up and says you aren’t getting a check, that’s a piece of information you have to act on,” said Jed Lyons, CEO of Rowman & Littlefield.

Mr. Lyons said he wanted more information from Borders and expected to learn more from the bookseller this week. “Up until now they’d been paying us like clockwork,” he said.

[...]

Mr. Lyons said that about a year ago, National Book Network approached its clients and said that if they wanted their books distributed to Borders, they would have to assume the risk associated with that business. Most clients, he added, responded by saying they wanted to continue shipping to Borders.

Borders is the U.S. retail partner for Kobo, the Indigo-owned e-book company, which nevertheless put a rosy spin on its holiday numbers. In a press release, Kobo reported that it had its best weekend ever on Christmas and Boxing Day, and that the number of registered Kobo users had nearly doubled since mid-November.

“Earlier this month we predicted that Christmas would be a record breaker for Kobo, and we have exceeded our expectations driving several ebook downloads per second since Christmas Eve, or an equivalent number hardcover books stacked as high as 50 Empire State Buildings [sic],”  Kobo CEO Michael Serbinis said in the release. Kobo also noted that it had experienced some of its biggest gains outside North America, in countries such as Germany, the Netherlands, and Singapore.

Aussie readers asked for input about future of publishing

Last week, the Internet behemoth Google launched its e-book sales site, Google eBooks, in the U.S. The e-book market is now crowded with offerings from Amazon, Kobo, Apple, and Sony, which in turn has spawned a cottage industry for articles about the future of reading and the future of publishing. Amid all this cacophony, it’s small wonder publishers have responded to the rapidly diversifying marketplace with a mixture of fear and confusion.

In Australia, a consortium called the Book Industry Strategy Group is directly petitioning readers about their reading habits, desires, and preferences as a way of gaining clearer insights into the way forward. Writing in the Sydney Morning Herald, Barry Jones, chair of the BISG, states that the group is “seeking ideas from all Australians on how to face the challenges of the digital age, and to turn them into opportunities.” Jones suggests that opportunities lie in the flexibility and ready availability of e-books as against their print counterparts:

Where Amazon and Apple have got it right is the immediacy of purchasing an eBook. Both the Kindle and the iPad come with wireless connectivity to the Amazon and Apple stores, respectively. In the case of the Kindle, if you have an Amazon account, the Kindle comes preconfigured with your details so you can buy a book at 3am if you so desire. New York Times technology writer Nick Bilton calls this Me Economics, which is really just instant gratification in book buying. But it beats late-night television.

And although Jones throws a bone to those of us who still enjoy reading printed books (which he refers to as “pBooks”), it is clear that the digital arena is where he and his group are most invested:

And what about people who like the smell of books or the feel of books, or the cover artwork, or who just want to scribble over the pages? No, these sorts of people will mix up their reading habits and buy both pBooks and eBooks.

Public libraries are starting to offer access to eBooks via downloads or by access, by borrowers, to subscriptions taken out by the library. We want to hear about these initiatives and your experiences with them.

School kids will agree that carrying an eReader with all their textbooks on it beats carrying a heavy school bag with all their textbooks in it. And textbooks form a large part of the book industry in Australia. Can we hear your thoughts?

The public can submit comments and suggestions to the BISG until Jan. 31, 2011. One hopes that they will be slightly more innovative and nuanced than the sort of shopworn analysis Jones allows himself above.

Daily book biz round-up: book hunting on Google eBooks; when Franzen met Oprah; and more

Today’s book news:

• MobyLives goes book hunting on Google eBooks
• Salon’s Laura Miller picks the best fiction and non-fiction of 2010
• WikiLeaks defector writes tell-all book (but it’s in German, so don’t get too excited)
• EW on the long-awaited meeting of Franzen and Oprah
• Lisa Moore and Emma Donoghue make New Yorker‘s best of 2010 list

Daily book biz round-up: Franzen has Bad Sex; back to normal at Gaspereau; and more

Today’s book news:

• Sarah Palin tweets her displeasure re: leak of impending book
• Franzen up for Bad Sex Award alongside Annabel Lyon
• Scribd aims to change the act of writing via new, depressing analytics tool
• Everything back to normal at Gaspereau
• Wealthy males supporting e-book biz by buying books they’ll never read

Google Editions to launch before year’s end

Representatives from Google met with publishers at the Frankfurt Book Fair this week and revealed that the long-awaited Google Editions will debut (in the U.S., at least) this year, despite rumours to the contrary. According to The Bookseller:

Abraham Murray, product manager on Google’s Books team, said at launch in the U.S. there would be over 400,000 paid-for titles available from “publisher partners,” along with two million public domain titles, but that more titles would be made available once the service opened internationally [in 2011]. He said the company was working with more than 35,000 publisher partners, in more than 100 countries, and added that he hoped to launch in “much of Europe in first half of the following year.”

However, there are already signs that Google Editions might not be the saviour publishers were hoping for. Though Google plans to use the publisher-preferred agency pricing model, the Google rep admitted this was not a model Google had sought out and hinted that it might be subject to change:

“We will meet the needs of the market, and we are accepting the agency model in the U.S., but we haven’t gone after it, and as that plays out we will follow,” he said.

Daily book biz round-up: Borders clams up; Lisbeth Salander cast; and more

Today’s book news:

• Things so bad at Borders they’re not talking to the press any more
• Somebody named Rooney Mara to become Lisbeth Salander
• Emma Thompson taking over Beatrix Potter’s Peter Rabbit
• HarperCollins Canada to go ahead with Bob Probert memoir
• Scott Pilgrim vs the print book