How do PDF EPUB and mobi formats differ in the e-book market?

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A person holds a Sony e-reader displaying text in front of a large illuminated sign reading e-book multiple times at the Frankfurt Book Fair in Germany. — e-book An e-reader on display at the Frankfurt Book Fair, Germany, 2012.

In the e-book market, PDF, EPUB, and mobi serve as de facto standards for digital reading, though they function differently due to their technical nature and the influence of digital rights management (DRM).1

PDF (Portable Document Format): An open format widely used for documents that require a fixed layout, ensuring the content appears the same across different devices.
EPUB: An open standard designed for reflowable content, allowing text to adjust dynamically to different screen sizes and user preferences on various e-reading applications.
mobi: A format historically associated with Amazon’s Kindle ecosystem.

While these formats are technically capable of being read on many devices, the market is often fragmented by proprietary DRM systems. These systems encrypt files, locking them to a specific user's identity and the software controlled by the company (such as Amazon or Apple). Consequently, even if a device supports a specific file type, it may be unable to open files protected by a competitor's proprietary DRM.1