Cudo, the Microsoft-backed Australian daily deal site that offered a $99 Chinese e-reader bundled with a CD of pirated e-books (Stephen King, J.K. Rowling), is now blaming the e-reader merchant for the mistake. Update: Those who bought the deal will get a different e-reader, the Pico, plus a DVD of “publicly available e-book content compiled from Project Gutenberg.”
Cudo told me it sold 2,317 e-readers by the time the deal ended yesterday. At $99 each, it grossed AUD $229,383 (USD $247,404).
Everyone who bought the e-reader deal gets a “higher quality” e-reader, the Pico, as well as a DVD of public domain titles from Project Gutenberg.
Cudo CEO Mike Sneesby provided the following statement placing the blame on the e-reader retailer, Grab Bargains:
Despite the merchant’s assurances that the offer complies with all relevant Australian laws, including copyright laws, our assessment of the 4,000 e-book titles being offered determined that this may not be the case.
It appears the merchant of this deal has breached the terms of their Cudo booking agreement. As soon as we determined this, Cudo took action to replace the merchant’s product with a higher quality device and provide our customers with a new source of legitimate e-book content.
Customers who purchased the deal will receive a higher specification e-book reader, and we are in the process of contacting all customers to inform them of this.
Australian publishers are mad, the Sydney Morning Herald reports. NSW Fair Trading minister Anthony Roberts weighed in: “I don’t believe that group buying sites can walk away from quality or compliance of the goods and services sold through their sites.”