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Digital Books Start A New Chapter


Slide Show >>Richard D. Warren, a 58-year-old lawyer in California, is halfway through Ken Follett's novel Jackdaws. But he doesn't bother carrying around the book itself. Instead, he has a digital version of Follett he reads on his Palm Treo each morning as he commutes by train to San Francisco from his home in Berkeley. He's a big fan of such digital books. Usually, there are around seven titles on his Treo, and he buys at least two new ones each month. "It's just so versatile," he says. "I've tried to convert some friends to this, but they think it's kind of geeky."

Geeky? For now, maybe, but not for much longer. Many experts are convinced that digital books, after plenty of false starts, are finally ready for takeoff. "Every other form of media has gone digital -- music, newspapers, movies," says Joni Evans, a top literary agent who just left the William Morris Agency to start her own company that will focus on books and technology. "We're the only industry that hasn't lived up to the pace of technology. A revolution is around the corner."

What developments have won over people like Evans? Portable devices are becoming lighter and more appealing. Books are being scanned into digital form by the thousands. The most important step forward may be in "digital ink," the technology used for displaying letters on a screen. A small company called E Ink has created a method for arranging tiny black and white capsules into words and images with an electronic charge. Because no power is used unless the reader changes the page, devices with the technology could go as long as 20 books between battery charges. The text also looks just as sharp as ink on a printed page, since each capsule is the size and pigment of a grain of laser-jet toner.

Sony is the first major player to take advantage of the technology. This spring, it will debut the Sony Reader, which uses E Ink and closely mimics the size, weight, and feel of a book. The Reader will sell for about $400. Sony also will offer roughly 10,000 book titles for download from its online store, along with news stories and blog items.

Other players sniff opportunity, too. At least two more companies are introducing digital readers this year. And scores of companies, from Google to Random House Inc., are angling for other ways to profit from digital books. Chalk it up to the influence of Apple Computer Inc. (AAPL). With its iPod, Apple has demonstrated that millions of people are willing to carry around digital devices with their favorite content. After music, why not novels and nonfiction? "The iPod led the way in getting people comfortable with [a similar device for books]," says Jack Romanos, CEO of Simon & Schuster Inc. (CBS). "These things are not only inevitable, but a good idea."

No book company has come close to Apple's magic touch. But the technology, availability of content, and consumer behavior may be aligned for a breakthrough this year. "The puzzle pieces are on the table," says Timothy O'Reilly, founder of the tech publisher O'Reilly Media. "You've got the critical mass of content, and you've got attractive hardware. What we don't have yet is an attractive business model that connects them all together."

Sony is clearly attempting to pull off this feat. Its combination of device and online store is reminiscent of Apple's approach. The Reader is impressive: a slim, sturdy package that weighs nine ounces and comes bound in heavy faux leather. But it's unlikely just yet to become the kind of cult hit Apple has on its hands. The Reader's controls can be clumsy to use. Plus, new books for the device will cost about the same as books from megastores like Borders, and readers will have to search the Web on their own to get classics that have gone off copyright for free.

The other makers of digital readers are treading cautiously. Jinke, a Chinese company, plans to sell into the education field in China and other markets. But it declined to comment in detail on its plans. IRex Technologies, a spin-off from Royal Philips Electronics, says it will make a device available for sale by April. CEO Willem Endhoven says the company will begin by selling to companies, such as newspaper or textbook publishers, rather than directly to consumers.

There are sure to be other companies that introduce readers in the months and years ahead. Plastic Logic Inc., a British startup, is working on a flexible display the size of an 8 1/2-in.-by-11-in. piece of paper that can receive books, news, or e-mail wirelessly. It's partnering with Japan's NTT DoCoMo (DCM) and plans to have a product on the market by early 2008.

There's even speculation that Apple could come out with its own device, an iPod designed for books. The secretive company hasn't said anything publicly and declined to comment for this article.

Just as digital readers are hitting the market, the number of books on the Net is swelling to Library of Congress proportions. Google, through an initiative it began a year ago, is scanning millions of books from five of the world's largest libraries and plans to make the contents searchable online. The effort has drawn the ire of publishers and authors, since it's digitizing some books still under copyright. Publishers sued last fall for copyright infringement and the case is pending. (One of the plaintiffs in the case is The McGraw-Hill Companies (MHP), the parent of BusinessWeek.)

NEW LITERARY MODELS

Yet Google is helping ignite the digital market. In November, following the lawsuit, Random House announced plans to digitize 25,000 titles. It will sell access to them to consumers, charging a per page rate for everything from novels to recipes out of a cookbook. In December, HarperCollins Publishers Inc. said it would build a digital warehouse of its entire holdings -- another 25,000 titles or so -- which it may later sell over the Net.

Amazon.com is moving aggressively into digital books, too. It sells digital versions of most of its titles, available for download instantly. In August, it launched Amazon Shorts, a collection of stories, novellas, and essays that can be downloaded for 49 cents apiece. Later this year it plans to offer shoppers who purchase traditional books the chance to buy a version they they can read on the Web, too. That way they could keep Stephen King's Cell: A Novel on their nightstand and read a chapter from any computer with Net access. "We think consumers increasingly are ready for it," says Steve Kessel, vice-president for worldwide digital media.

Authors are intrigued by the opportunities to go digital. George Saunders, a short story author and professor of English at Syracuse University, says he'd like a way to get his work out to readers more quickly. After the scandal broke over James Frey's falsehoods in his hit book A Million Little Pieces, Saunders penned a humorous essay stemming from the events. It was a confession to Oprah Winfrey that all of the fiction he'd written had, in fact, been true. But Saunders had a hard time getting the piece published quickly, and now it feels dated. "There might be a different model for a literary community that's quicker, more real-time, and involves more spontaneity," he says. If digital books finally do take off, they could change not only how we read, but what we read, too.

By Burt Helm


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