Kompas Gramedia to Launch Kindle-like E-Book Reader Soon

I remember that one of startups from Indonesia, Papataka, is actively selling e-book and has its own e-book reader (will be mentioned as e-reader hencefort). Instead of able to compete with Amazon Kindle that hasn’t made official presence here in Indonesia, Papataka will face competition from media conglomerate group: Kompas Gramedia which soon to release its own e-reader. This step needs to be taken seriously by other startups engaged in media content digitalization.

As reported by The Jakarta Post, Vice President of Kompas Cyber Media, Edi Taslim said that it will join hands with local and foreign vendors to produce this e-reader. In addition, it also developing its own payment gateway to handle e-book digital purchasing. Content is certainly not a problem for Kompas Gramedia group because it is the biggest media group in this country, its business includes book, magazine and newspaper publishing.

Edi Taslim said that the preparation of this product (including the payment gateway) has been done for the last 1.5 year and expected to be launched this year. The decision to make its own paymen gateway is also an effort to minimized budget and eventually will cut the sale price to the customer. It is said that the total investment for this product reached USD4,6 millions (or around IDR43 billion).

Book and magazine market trend in Indonesia has not shift from printed media, although some digital products have existed, especially for tablet market such as iPad and Android based tablets. I’m sure that Kompas Gramedia’s step to enter the business is a signal that Indonesian market is ready (and get accustomed) to access content digitally.

Why choose to create its own tablet rather than using the available tablet platform? Actually, this is similar with why Amazon is still updating its Kindle. Hardware wise, e-reader is designed to be comfortable on the eyes so even though used for a long period of time. Software wise, Kompas Gramedia has its own closed platform which running content/app is easily controlled. It’s not impossible if Kompas Gramedia takes the same path as Amazon to make Android based e-reader.

E-reader tablet certainly contributes quite an income. What’s important in this business is how Kompas Gramedia can gain continuous income from the reader of its content. The cheapest Amazon Kindle is sold “to loss” (or subsidies) with the hope that e-book sale will be able to cover it.

The year 2012 marked the agresivity of Kompas Gramedia group in entering digital content. Formerly, it has acquired 60% of ownership of online directory service, Urbanesia. Will the presence of e-reader platform from Kompas Gramedia kill the competition? Capital and experience wise, this could happen. How a startup know which nook to be taken is important to survive in this segment.