Wal-Mart, Rakuten Take On Amazon

USA retail giant Walmart and Japanese internet titan Rakuten unveiled a strategic partnership which will include collaboration on digital books in the United States and grocery delivery in Japan. That is likely to boost Kobo's tiny share of the US e-books market share and turn it into a serious contender.

The companies said a joint venture would be established between Japan online grocery delivery service Rakuten and Seiyu GK, a subsidiary of Walmart.

The deal "enables us to quickly and efficiently launch a full eBook and audiobook catalog on Walmart.com", Scott Hilton, chief revenue officer for Wal-Mart's USA e-commerce unit, wrote in a blog post Thursday. Rakuten's online marketplace has 93 million registered members, capturing a huge volume of e-commerce in Japan.

"We look forward to expanding our grocery footprint in Japan and launching a new offering of eBooks and audiobooks for our customers in the United States", he added.

"I believe this will be a globally unprecedented, powerful alliance", Rakuten's billionaire founder and Chief Executive Officer Hiroshi Mikitani said at the company's Tokyo headquarters, accompanied by Walmart CEO Doug McMillon.

Walmart hopes to tap into Rakuten's expertise in e-commerce as well as its big data and artificial intelligence capabilities.

Walmart has strengthened its foothold in Japan after striking a deal with ecommerce retailer Rakuten to launch an online delivery service in the country.

"We are excited to partner with Walmart because of its commitment to creating the best solutions to serve customers with low prices".

Amazon stunned the USA retail industry past year by paying about $14 billion for Whole Foods.

Furthermore, the new service will utilize Rakuten's deep expertise in e-commerce to offer a site with an optimized user experience, as well as leveraging big data and AI to offer a more personalized merchandise offering. The company's e-books - which include six million titles, from best-sellers to children's books - can be read on Kobo devices or on a new co-branded Walmart-Kobo app.

Customers of the new venture - to be called Rakuten Seiyu Netsuper - will be able to accumulate points on Rakuten's loyalty program, which can be used on any of Rakuten's services. Rakuten, if you remember, snapped up Canadian Kindle-competitor Kobo in a $315 million deal back in 2011, before rebranding it as Rakuten Kobo a few years later. Walmart will also sell digital book cards in stores, enabling more than 4,000 stores to carry a broader selection of books for customers.