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 than the rates offered by other publishers.
The move will "create a direct link between authors and their 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 by creating new demand for existing books and by encouraging new entrepreneurial ways to publish," Barnesandnoble.com vice chairman Steve Riggio said.
Percentages Count
Barnesandnoble.com said it will make its digital publications available to other e-book sellers, as well as selling them over the Barnes & Noble network. The first titles will be available this spring, with a new book from best-selling author 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 the retail price of a book sold directly through Barnesandnoble.com or its affiliate network, and 50 percent of net revenue from sales through third parties. The company said the rate is "significantly higher" than that offered by other online publishers.
Priced To Sell
Most of the books will be priced between US$5.95 and $7.95. Consumers, the company said, will enjoy the instant delivery and the lack of 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 books currently in print. Fiction, science fiction, business, history, biography, and self-help e-books are planned.
Out-of-print books will also be available, using the company's print-on-demand facility.
Literary agents can check on their clients' sales through a password-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 publishing market is set to soar, growing from $9 million in 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.
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