Barnesandnoble.com Expands E-Book Efforts

In a bid to capture a share of the emerging market for electronic books, Barnesandnoble.com (Nasdaq: BNBN) said Thursday that it has created an e-publishing division that will offer authors a royalty rate higher thanthe rates offered by other publishers.

The move will “create a direct link between authors andtheir readers” and give authors a greater share of the income from their works, the company said. Barnesandnoble.com also said that it will offer lower retail prices in an effort to build the emerging e-book market.

“We believe e-books will help to increase the size of the book market bycreating new demand for existing books and by encouraging newentrepreneurial ways to publish,” Barnesandnoble.com vice chairman Steve Riggio said.

Percentages Count

Barnesandnoble.com said it will make its digital publications available to othere-book sellers, as well as selling them over the Barnes & Noble network. Thefirst titles will be available this spring, with a new book from best-sellingauthor Dean Koontz, the company said.

Koontz, who will make his e-book debut with “The Book of Counted Sorrows,”called the Barnes & Noble venture a “terrific opportunity” to reach readers.

The company is pitching the e-publishing division as an important resource for authors, with editorial support and online sales monitoring, in addition to exposure on the Barnesandnoble.com site.

The new division, Barnes & Noble Digital, will pay authors 35 percent of theretail price of a book sold directly through Barnesandnoble.comor its affiliate network, and 50 percent of net revenue from sales throughthird parties. The company said the rate is “significantly higher” than thatoffered by other online publishers.

Priced To Sell

Most of the books will be priced between US$5.95 and $7.95. Consumers, thecompany said, will enjoy the instant delivery and the lackof sales tax in all U.S. states except New York.

In addition to new works by established authors such as Koontz, Barnes &Noble Digital will focus on electronic versions of general-interest bookscurrently in print. Fiction, science fiction, business, history, biography, andself-help e-books are planned.

Out-of-print books will also be available, using the company’sprint-on-demand facility.

Literary agents can check on their clients’ sales through apassword-protected area of the bn.com Web site, the company said.

Brick Players

A report issued last month by research firm IDC predicted that the digital publishingmarket is set to soar, growing from $9 millionin 2000 to $414 million in 2004.

Recognizing the potential that the e-book market holds, several major publishers, including Time Warner and Random House, have set up digital publishing divisions.