blog Disturbing news broke late yesterday about REDgroup Retail, the company which operates the Borders and Angus & Robertson brands in Australia, as well as Whitcoulls in New Zealand. From a press release published by administrators Ferrier Hodgson:

“Ferrier Hodgson partners have been appointed voluntary administrators of REDgroup Retail Pty Ltd, which owns and operates Angus & Robertson, Borders and Whitcoulls (NZ). The appointment was made by the REDgroup board. Ferrier Hodgson partner Steve Sherman said as far as possible it would be business as usual while the administrators conduct an urgent assessment of the business’s financial status and prepare for the first meeting of creditors. During this period he called for regular Angus & Robertson, Borders and Whitcoulls customers to continue supporting their local outlets.”

The news immediately sparked concern about whether customers would be able to keep the eBooks which they had accumulated since Borders’ national launch of the Kobo platform in Australia in mid-2010. But a series of articles by publications like iTNews and ZDNet.com.au has put paid to that worry, with former REDGroup Retail spokesperson and now Australian Kobo representative Malcolm Neill stating the company would continue as normal. In addition, there was this reassuring entry posted on the Kobo blog:

“Your ebook library is perfectly safe. The Borders ebook experience is powered by Kobo, an entirely separate company from Borders. Kobo is financially secure and will continue to maintain your ebook library no matter what happens.”

Now much of the mainstream media attention on the REDgroup Retail issue has focused on the idea that the introduction of eBooks has had a negative effect on the financial fortunes of hard copy booksellers such as the brands operated by the company. And there’s some truth to this idea — with Amazon now selling more eBooks than hard copies, and Apple making a strong push into the market with iBooks, there is no doubt that the eBook phenomenon is getting bigger all the time, although the importation of hard copies of books and even the discount prices of retailers like Big W are more likely culprits for REDgroup’s troubles.

However, it’s hard to see the demise of REDgroup Retail as anything other than negative for Australia when it comes to the future of eBooks Down Under.

Over the past year, the company has earned itself pride of place as the chief local evangelist for the eBook phenomenon in the Australian market. With independent booksellers and major chains like Dymocks alike appearing to primarily view eBooks as a threat to their business, it has been REDgroup Retail — with its flagship Kobo partnership — that has been one of the only forces pushing the eBook meme hard to the industry.

At Borders’ launch of the Kobo device in May last year, the company displayed a strong commitment to not only bridging the gap between the traditional publishing industry and the growing eBook phenomenon, but bringing a strongly Australian flavour to the process while doing so.

REDgroup Retail managing director Dave Fenlon said Borders — through Kobo — had created an “eBook store for Australians” specifically to serve the local market — populating it with Australian content and setting up a string of relationships with Australian publishers to make sure our cultural heritage made it into the eBook age.

With the financial problems being suffered by REDgroup Retail, however, that dream seems likely to go up in smoke. There is now no centre of gravity for the Australian eBook scene to congregate around — instead, local readers will now increasingly look towards the likes of Amazon and Apple for their content — even more so than they were already. And Australian writers and publishers will also look to the same global eBook distribution mechanisms.

In many ways this isn’t a bad thing — after all, Amazon and Apple are doing a better job than any other company in providing what readers actually want — universal availability of eBooks, instantly, and at the right price. However, it does mean Australian writers and publishers will have to fight that much hard to get noticed in a flood of global content. With less localised distribution channels to highlight specifically Australian content, one wonders whether local content will simply get lost in the wash.

The argument on the other side of the coin holds that if Australian content can’t hold its own against global content on the same terms and in the same distribution mechanism, it deserves to be ignored anyway. But I think the truth is somewhere in the middle. And for me, today, Australia’s cultural line just got pushed back a little further towards obscurity.

Image credit: Borders