Canadian-based e-book seller Kobo is following in Amazon's footsteps and creating a publishing arm that will deal directly with authors, CBC News has learned.  

Kobo, whose major shareholder is Indigo Books, will roll out its program sometime next year, according to CEO Michael Serbinis.

Like Amazon, which announced two weeks ago that it would be publishing 122 original titles this fall, Kobo will be offering complete publishing services for authors, including book editing and design.

"It's part of the new market and if you expect to be a number 1 player in that market globally it's table stakes — you have to provide it," Serbinis told CBC News.

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Kobo CEO Michael Serbinis has confirmed his company will move into publishing. ((CBC))

Amazon's move into publishing cuts out the middle man — the traditional publisher — and promises writers more of the proceeds from their e-book sales.

American thriller writer Barry Eisler is one of the top-selling authors who Amazon has signed as it expands from being an online retailer to a publisher of both electronic and print books. 

Eisler gave up a $500,000 US two-book offer from his long-time publisher to go with Amazon. 

His new book, The Detachment, was released digitally last month and is smashing his personal e-book sales record.

"I'm making far more per unit than I would ever make with a legacy publisher," Eisler said. "And I'm also selling the book in far more volume than I would have with a legacy publisher or than I could have even on my own."

The head of the Writers' Union of Canada, Greg Hollingshead, expects Amazon and Kobo will gobble up a bunch of business that would otherwise go to traditional publishers.

"They're clearly a major threat to publishers," he told CBC News.

But if Canadian publishers are worried about Amazon and Kobo infringing on their turf, they're not admitting  it.

"It will be good for writers to have more choices," said Louise Dennys of Random House. "I'm just confident we'll continue to do what we do best; the more the merrier."

With files from CBC's Margo Kelly