Canada's Indigo Books & Music has spun off its Shortcovers e-book service, which has been renamed Kobo (an anagram for "book"), and sold interests in the new company to Borders Group; REDGroup Retail, the private equity company that owns bookselling chains in Australia and New Zealand, including Borders, Angus & Robertson and Whitcoulls; and Cheung Kong Holdings, a Hong Kong property development and strategic investment company.
Kobo is a reader and e-book supplier that has been popular on mobile devices like the iPhone and BlackBerry, computers and e-readers like the Sony Reader. Since Shortcovers began in February, its reader has been downloaded more than a million times. Through an agreement with the Internet Archive, Kobo offers 1.8 million free e-books; it also sells several hundred thousand e-books. Kobo said it has "relationships with thousands of publishers and is actively adding book, newspaper and magazine publishers worldwide." Kobo plans to add more smartphone support, desktop and tablet apps and introduce its own e-reader device a la the Kindle or Nook.
Next year Borders and REDGroup's booksellers will begin using Kobo to sell e-books to customers. Borders will launch an e-book store on Borders.com and through Borders-branded apps.
Borders Group CEO Ron Marshall stated: "Our partnership and investment in Kobo is a significant step in our digital strategy of providing eBooks however our customers want to consume them. Kobo's global, device neutral and open approach will allow Borders-branded software applications to be downloaded on a variety of devices and is the right move for Borders as the digital market continues to evolve. We look forward to building on this key element of our digital strategy as we address the growing eBook opportunity while also remaining committed to improving our brick and mortar superstore business."