Boom Time For On-Line Books?


by Adam Keller

AUTHOR STEPHEN KING’S recent foray into e-book publishing has kicked
off a new round of activity among book publishers and software
developers looking to gain a foothold in the nascent market.
Since last year, well-known book publishers such as Houghton
Mifflin Co., The McGraw-Hill Cos. and Simon & Schuster Inc.
have hooked up with software companies to convert books into
digital format and enable them to be read on screen.

Now Adobe Systems Inc. and Microsoft Corp. are duking it out in
the market for e-book reading software. In November at the
Seybold Seminars conference in New York City, Adobe announced
that it has acquired Glassbook Inc., a provider of e-book
software that last week announced a beta version of its Reader
2.0 software. Terms of the deal were not released.

Features of Reader 2.0, include two-page views, text-to-speech capabilities,
screen rotation, text annotation and highlighting with electronic
sticky notes, searching and text enhancement to make content
easier to read, said officials from Glassbook, of Waltham,

Adobe, of San Jose, Calif., also announced an expanded partnership
with digital content services company to offer
authors and publishers a faster and less expensive way to
publish, manage and distribute their content as e-books.

Separately at the show, Microsoft announced a partnership with on-line
retailer to create a customized version of the
Microsoft Reader e-book software. The new version will enable
consumers to purchase and download e-book titles directly
from Microsoft Reader will be the preferred format
for’s future e-book store.

Microsoft and Adobe have similar relationships with Barnes&
Microsoft, of Redmond, Wash., also selected ContentGuard Inc.,
a provider of digital rights management software for content,
to help booksellers, publishers and consumers easily adopt
the digital format. ContentGuard will support Microsoft customers
who want to build distribution systems using Microsoft’s Digital
Asset Server in order to launch digital offerings.

Adobe already has a similar relationship with ContentGuard. ContentGuard’s
eBook Practice, announced this week, provides content preparation
and management services to on-line bookstores and publishers
so they can create digital offerings. The eBook Practice also
provides an outsourced operation to manage the entire eBook
distribution process and a consulting service to install and
manage in-house e-book operations, said officials of the McLean,
Va., company.

The stakes in the race to create standard e-book software are
not small. “If you get to be the provider of software for
reading, essentially you get to be the toll keeper,” said
Jonathan Gaw, Internet research manager at International Data
Corp. in Mountain View, Calif. “For every book or magazine
article that uses this software, then you get to charge a
toll, and if it’s 5 or 10 cents per article, that adds up
quickly. The question is, who will develop the best and most
widely accepted standard?”

Boston-based Houghton Mifflin is working with several of the reading software vendors, including a pending agreement with Microsoft in the
next few months, to reach more consumers and cover the different
ways – PC, laptop, personal digital assistant – they want to
receive e-books.

“We’re working to do this as intelligently as we can,” said David
Jost, vice president of electronic publishing in the company’s
trade and reference division. “Every e-book company has their
own reading or e-book format. We have to check each company’s
version of the book to make it consistent with our print version.”

McGraw-Hill is also embracing the technology in this evolving market.
It plans to have a total of 700 e-books on its list by the
end of September 2001, and 250 of them will be sold through
the company’s new on-line store.

“We’re providing our customers with books in as many formats as possible,”
said April Hattori, a spokeswoman for McGraw-Hill in New York.
“We want to be able to give our customers a choice. It’s important
to be in as many places as possible.”

Although both Jost and Hattori believe publishing e-books will lower
costs in the long run, they said it’s too early to predict
how much. While e-books will cut down on unused hard copy
inventory, publishers will still have to pay software programmers
to convert books into the proper electronic format, Jost said.

According to Billy Pidgeon, a Web technologies analyst at Jupiter Communications Inc. in New York, the market for e-books is in its infancy.
“It’s really early. Dedicated hardware is very iffy. Audio
books as digital files with an MP3 player is a more immediate
market.” Publishers have to develop consumer awareness for
e-books, and vendors have to drive consumer adoption, Pidgeon
said, noting that book printers are working with publishers
to support common standards for text such as Microsoft Word
and Adobe PDF.

“To a large extent the publishing industry is still in the Guttenberg
era, and it’s being dragged into the digital era,” he said.
“It’s going to be a rough ride for some of these publishers.
Fortunately, the market is still young, so there will be some
time. But for publishers not looking at this space, they may
be losing an opportunity.”

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