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Is Amazon’s Kindle Really a “Game Changer” for India?

Current trends are favorable to e-book growth in India, but there are questions about whether Kindle will be a runaway success.

By Vinutha Mallya

BANGALORE: Nearly six months after entering India as retail aggregator Junglee.com, Amazon announced the launch of its India Kindle Store last week. Book readers in India will now be able to purchase Kindle editions on Amazon.com by paying in Indian Rupees (INR).

This option makes Kindle editions accessible to readers whose credit cards (Visa and Mastercard only) are not valid for international, i.e. dollar, transactions. The India storefront has begun displaying Kindle editions of books by bestselling authors — Chetan Bhagat, Amish Tripathi and Ashwin Sanghi, among others.

Technically though, there is no separate India store. The Kindle editions for India are made available through the US store (Amazon.com). The listed USD prices will also show in INR at the current exchange value. Even when the publisher/author/rights-holder sets a separate price for India, which is now an option, the price has to be set in dollars. But not everything on the US Kindle store is available in INR, like magazines and newspaper subscriptions.

Perhaps the better news for authors is that Amazon has opened the Kindle Direct Publishing (KDP) service in INR, offering only the 35% royalty option. Royalty payments will be made in INR, into local bank accounts.

Amazon initially launched in India as "Junglee," a retail aggregation site

For readers, the Kindle Wi-Fi 6” E Ink Display reader device is available at an “introductory price” of Rs 6999 ($127), by exclusive arrangement with the Croma electronics retail chain, in select cities. Until now, the Kindle range of gadgets were imported and sold by two online stores — IndiaPlaza.com and Indiatimes.com. Buyers will be able to get a demonstration of the device before purchasing it.

The announcement of the India store will potentially help create and boost e-book-publishing in the country. Although India is a top destination for publishing outsourcing, its domestic e-book market has been waiting in the wings. It was only last month that Penguin Books India, the largest trade publisher in the country, launched 240 titles as ebook editions, including its frontlist and selected titles from its backlist.

“Game Changer”

With India’s homegrown Amazon clone, Flipkart.com, having announced plans to offer e-books, industry watchers have no doubt that Amazon’s move in India will prove to be a “game changer.”

At any rate, current trends are favourable for e-book consumption: the smartphone market is thriving and online retail is gaining captive audience. Notably, according to the Federation of Indian Chambers of Commerce and Industry (FICCI) the publishing industry is growing at “a robust rate of 30%.”

But, the change to e-books from print books is likely to take time.

“In spite of what everyone is saying, I am not sure how popular e-books are in India. We will need some figures on the number of people reading e-books as a percentage of people reading books,” says Leonard Fernandes, co-founder of Goa-based Cinnamon Teal Print & Publishing Services, which provides self-publishing services to authors.

“It will be interesting to see if Amazon gets the same play here as they have in the West,” says Thomas Abraham, Managing Director, Hachette India. “Remember, this is now mainly Android country and I am not sure that captive proprietary devices will take off.”  With the Kindle app available free for almost all smartphones and platforms, and also in the cloud, Amazon may gain in that regard.

The price advantage that e-books have had in the West will not likely be an immediate differentiator in India, since trade books have traditionally been priced much lower than in other territories ($2–$6 for paperbacks). Hachette India has listed 50 of its 95 titles on the Kindle store in February this year, for sale in other territories, with the balance of titles slotted to go online soon. These e-books are being priced at the same rate as the print book. Abraham wonders if the average Indian reader would invest in an e-reading device to read e-books, “when he can just buy the print edition.”

What about impact on print sales? “There will definitely be an initial impact on print sales due to curiosity, but for how long it will sustain is a question mark,” says Venkat Valliappan, Category Head – Books, Indiaplaza.com. “The impact will be felt by trade fiction and non-fiction to begin with, but I don’t foresee that sale of academic books will be affected in the near future.”

Publishers’ readiness should not be overestimated either. “The real challenge for Amazon will be to sign up with Indian publishers to have ebook versions listed on the India Kindle Store. They will have to deal with all of the concerns and ignorance of publishers in India and educate them on piracy issues, digital conversion, format-related issues and costs, pricing of e-books, and their revenue potential. Many Indian publishers aren’t tech savvy and can’t easily relate to the opportunity,” says K. Satyanarayan, Director, New Horizon Media, a Chennai-based company publishing books in Tamil, English and Malayalam.

Satyanarayan foresees that the momentum will pick up over the next 2–3 years, “with Kindle and Flipkart and other major players competing aggressively.” The promotion and marketing of e-books as a category, to mass audience, will expand the market, he adds.

Publishers of books in Indian languages will need to gear up for e-books soon. Says Neeta Gupta, publisher of Yatra Books, a Hindi imprint, “Eight years back, when we set up Yatra and I was acquiring translation rights for several European language books, we didn’t even have a clause in our contract to deal with this situation! It seemed really far away and part of some sci-fi future. Now of course all that has changed. And Kindle has finally arrived in India. It is time to get our act together — because very soon Indian language readers are going to clamour for their own devices!”

What took Amazon so long?

Amazon’s effort at setting up shop in India has been a challenge because the prevalent law prevents foreign direct investment (FDI) in multi-brand retail. The law is currently under debate in the Parliament and in the media. Amazon could have invested in a joint venture (JV) with an Indian partner, but did not want to go that way. In January this year, the Indian Government approved Amazon’s proposal to invest Rs 15 crore ($2.7 million) in a wholly owned subsidiary (WoS) under the ‘Post’ category, “to undertake the business of online market place operator and retailer inter alia courier services.” The company’s entry into the Indian retail space was by re-launching Junglee.com as an aggregator service, after having acquired the site 1998. It was seen as a move to gain insight into the market, while Amazon waited for the debate on the FDI law to be resolved.

According to industry sources, Amazon has invested in gathering and processing market information much more than anybody else. Over the last year, it has been in touch with publishers and distributors to prepare for its future operations. Reuters reported in January this year that the company was setting up its first fulfillment centre in Mumbai. The company had set up software development centres in three Indian cities some years ago.

A contributing editor to Publishing Perspectives, Vinutha Mallya is an independent publishing consultant and editor based in Bangalore. You can reach her on Twitter @VinuthaMallya. 

DISCUSS: What Comes First, the Content or the Device? 

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One Comment

  1. Posted August 30, 2012 at 2:33 am | Permalink

    One of my readers loves ebooks because her mother in law watches everything she buys. Downloading gives her privacy.

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