An electronic book, or e-book, is a book that is accessed electronically via a personal computer (PC), a specially designed e-book reader, or a handheld device like a Palm Pilot. In most cases, users download the text from an Internet site after paying with a credit card. Depending on the technology used, e-book purchasers quite often have the capability to highlight, bookmark, and annotate specific passages, as well as the ability to search an entire document. Despite many bold predictions in the late 1990s that e-books would soon render paper publications obsolete, e-book sales remained weak in both 2000 and 2001 as three main issues—incompatible formats, difficult-to-use reading devices, and uncertainty surrounding copyright laws—continued to plague the industry by undercutting both supply and demand


Although the concept of electronic publishing had existed for several decades, it wasn’t until the summer of 1998 that specific devices for reading ebooks, as well as e-books themselves, became available at the retail level. Both NuvoMedia Inc. and Softbook Press Inc. developed e-book readers at that time. Designed to offer users an experience as close to reading a print book as possible, the NuvoMedia Rocket eBook’s screen was roughly the same size as a page in a traditional paperback book. Specific buttons allowed users to select either a landscape or portrait format, view the next or previous page, and pull down various menu options. The hardware appliance was designed to allow users to download texts from various online sites. While the Softbook reader offered many of the same features as the Rocket, its screen was nearly double in size, and the only way to import texts was to use a telephone line or Ethernet connection to link to a Softbook Press information center. In 1999, the two firms sold a total of roughly 10,000 ebook readers and offered less than 5,000 titles. Gemstar International Group Ltd. paid $400 million to buy both NuvoMedia and Softbook Press in January of 2000, planning to use advertising campaigns and licensing agreements to generate a higher demand for the e-book readers. That same month, and Microsoft announced their intent to work together to develop an e-book reader for PCs. Another e-book hardware maker, Glassbook, revealed plans to do the same. Popular author Stephen King released a new novella as an e-book in March, in conjunction with publisher Simon & Schuster. Problems with security measures allowed Internet users who had paid for the book to download multiple unauthorized copies. Publishers continued experimenting with e-book technology despite such problems. In fact, Simon & Schuster also began publishing novels by Mary Higgins Clark as e-books in May. The first Spanish language e-book made its way online in June. Two months later, Stephen King circumvented traditional publishers by offering a new novel, Ride the Bullet, on the Internet for $1 per chapter. More than 40,000 readers downloaded the first chapter within 15 hours of its release. At roughly the same time, Adobe Systems Inc. acquired Glassbook, and in November Franklin launched its palm-sized reader known as eBookman.


By the autumn of 2000, roughly 25,000 e-book reading devices had been sold, a number much lower than many analysts had predicted. Despite sluggish sales, several industry pundits cited the success of King’s online novel as an indication that e-books were finally finding a mainstream audience. Andersen Consulting predicted that e-book sales would exceed $2.3 billion by 2005, compared to less than $5 million in 2000. However, skeptics pointed out that King’s novel might not have generated such interest if a print version had been available as well. Along with meager demand, the e-book industry also contended with limited supply. E-book availability was growing at a much slower pace than e-book reading device makers had anticipated. In March of 2001, the number of e-books compatible with the industry’s leading platform—Gemstar’s RocketBook— had only reached a few thousand. Afraid that e-book sales might undercut traditional sales—particularly on new blockbuster releases likely to make the bestseller lists—many publishers only offered electronic versions of classics like Moby Dick, The Iliad, and Romeo and Juliet. Concerns regarding the impact e-book sales would have on traditional sales represented only a minor problem for the industry, however. Three others factors contributed more significantly to the supply and demand problems experienced within the ebook industry. One of the most pressing problems had to do with incompatible formats. By the end of the twentieth century, three main e-book players had emerged as industry leaders: Gemstar, Adobe, and Microsoft. According to a November 2000 article in The Atlantic Online, the fact that each firm was trying to position its format as the industry standard undercut the e-book industry as a whole. ‘‘E-books are software, and the future of reading is presently being held hostage in a computer ‘standards war’ where competing companies try to ensure that their proprietary technology becomes the toll-taker at the gate. Most publishers and retailers now offer every e-book title in at least two incompatible formats, sometimes three, and it may not stop there.’’ Uncertain as to which format would eventually dominate the industry and hesitant to commit to a format that might soon be rendered obsolete, many publishers entered the e-book industry more slowly than they otherwise might have. At the same time, and for similar reasons, consumers balked at the idea of paying hundreds of dollars for an e-book reading device that could read only one format. Another reason e-book readers were not selling well as the twentieth century came to an end had to do with the technology itself. The e-book reading devices simply were unable to compete with the convenience of a print book. Readers used to stuffing a paperback into a beach bag or setting a novel on the edge of the tub were unwilling to do the same with an expensive electronic device. Also, many e-book readers were difficult to read in the bright sun, some had to be held at a certain angle for optimal viewing, and all ran on a battery that required recharging At the same time that book lovers proved reluctant to give up the convenience and familiarity of print books for the increased functionality offered by electronic readers, many publishers proved reluctant to make a significant investment in e-book technology due to concerns over copyright issues. While new laws like the Digital Millennium Copyright Act, which made it illegal to make or sell products designed to skirt copyright laws, had been put in place to help protect copyright holders, publishers remained uncertain as to how to best protect copyrighted material offered electronically. In addition, those unwilling to publish electronic versions of their copyrighted books also worked to prevent other companies from doing so. For example, when RosettaBooks secured permission from authors such as Kurt Vonnegut and Robert Parker to publish electronic versions of their books, Random House, copyright holder of the traditional print books written by those authors, filed suit. The litigation, formally launched in February of 2001, likely will have a significant impact on the e-book industry


Despite the industry’s supply and demand problems, many leading publishers continue to develop new e-book ventures, believing that jockeying for position now might pay off in the long run. For example, Time Warner founded in February of 2001, offering roughly 200 e-books to children between six months and 10 years of age. Random House and Simon & Schuster also launched e-book initiatives aimed at youngsters. According to a May 2001 article in, ‘‘The assumption—or hope— behind this foray into children’s e-books is that today’s computer-savvy kids will be more receptive to books on screen than adults are. To them, the thinking goes, it will be nothing to read a 200-page young adult novel or look at the illustrations in Eency Weency Spider in an electronic format.’’ Some industry experts believe that the future of e-books is in other niche markets, such as text books and reference publications. According to PC Magazine writer Christina Wood, ‘‘the Electronic Document Systems Foundation predicts that the likelihood of people reading novels or even magazines digitally in the future is low. The chance that they will read digital reference materials, professional journals, and reports, however, is good.’’ While the direction the ebook industry will take in the future is unclear—as is the impact e-books will have on the traditional book industry—authors, publishers, and readers will likely continue to influence and be influenced by e-book technology