TERENCE SMITH: M.J. Rose is an e- book evangelist.
M.J. ROSE: We are real. We are published. We are read. There were over five million e-books downloaded and read last year. They weren't all paid for, but they were read. (Laughter)
TERENCE SMITH: She helped organize a special day at the Virginia Festival of the Book this year to discuss, sell, and for the first time honor e-books.
WOMAN: ...And the winner is "Nessy and the Living Stone" by Lois June Wickstrom and Jean Lorrah. (Applause)
TERENCE SMITH: E-books are books made available in electronic, digital format for use on various palms, computers and specialized reading devices currently priced anywhere from $100 to $600. So far, fewer than 100,000 of the readers have been sold, but e-books are nonetheless changing the publishing business, and in some cases they're changing authors' lives.
M.J. ROSE: I was at a point in my life where I really needed to know that I had readers.
TERENCE SMITH: An unpublished author, M.J. Rose posted her first book on the Internet.
M. J. ROSE: I thought if I put my book up on the Internet as a file that you could download, and I told people about it, maybe some people would download it and read it, and maybe I could get some response.
TERENCE SMITH: Eventually her steamy novel, entitled "Lip Service," created such a buzz on the Internet that it caught the eye of an editor at Doubleday. The editor featured it on a book list that typically includes best-sellers. Two weeks later, Simon & Schuster agreed to publish the book on paper. This year, Simon & Schuster put Rose's second novel out as an e-book three weeks prior to the print release. She sold a brisk 25,000 books in both formats in the first eight weeks.
TERENCE SMITH: So these two books by you in paper would not even be here if it wasn't for e-books.
M.J. ROSE: No, that's true. It started on the Internet, and it wound up in a store.
TERENCE SMITH: The e-book universe is tiny compared to the world of print. There are slightly over 20,000 titles available electronically, but there are more than 100,000 printed titles in this bookstore alone. E-books may someday cause a revolution like the one Gutenberg began with his Bible, but today they are in large part promotional devices for authors.
M. J. ROSE: For a mid-list author, anybody that's under the, you know, best-selling level, I think that they're marvelous marketing devices. They're samplers, they're browsing tools, they're giveaways. I have contests myself for my Web site, and I give away 50 at a time, and I really get a lot out of that.
TERENCE SMITH: Major publishers now often freely release the first chapters of new books online at retail sites like Amazon.com and barnesandnoble.com. That seems to be all most people are willing to read on a screen.
LAWRENCE KIRSHBAUM: When we first got into e-books, we had a kind of a "gee whiz, isn't this cool, and everybody's going to be reading e-books in a week."
TERENCE SMITH: A year after Stephen King made a splash by publishing a short novel as an e-book, Larry Kirshbaum, chairman of Time Warner Trade Publishing, concedes that he still prefers print for most of his reading.
You said you struggle with it. What do you struggle with?
LAWRENCE KIRSHBAUM: Well, you struggle with, with, with all of it, Terry. You struggle with the technology part of it, downloading it and making sure that you've got the book that you want, and you struggle with the reader.
TERENCE SMITH: What is necessary for e-books to take off?
LAWRENCE KIRSHBAUM: The devices have to get better. They have to get cheaper. I don't think that people want to carry a separate reader just in order to read books. They want to have a reader that is also, in part, a computer, which may offer other services.
TERENCE SMITH: Walter Mossberg has tested lots of e-books and other gadgets as personal technology columnist at The Wall Street Journal. He thinks manufacturers of e-book readers should focus on improving the reading experience.
WALTER MOSSBERG: E-books as a fact of our lives are not going to take off based on devices that were made for other things. They're going to take off when we get the right price, the right screen, the right battery life, the right durability.
TERENCE SMITH: Among the current devices made for reading e-books is Mossberg's favorite, the Gemstar-RCA e-book.
WALTER MOSSBERG: I could select that paragraph, and there's the bookmark, and then later...
TERENCE SMITH: It can be used independently of a PC, but can read only a limited list of books. It costs $299.
WALTER MOSSBERG: This feels good in your hand. It's got kind of a tactile feel here. It's got a couple of very simple buttons for turning pages, and four icons for doing certain others things like arranging the font and switching from book to book, and it has a plausible battery life, something like seven or eight hours of battery life.
Even though this is better, you're not taking this to many of the places you would read a book. You're not taking this to the beach because you'd be terrified you'd get sand in it and break down. In many cases you're not reading it outside because the screen isn't particularly good outside, and when the battery runs out, wherever you are in the middle of the book, you're kind of stuck.
TERENCE SMITH: But at the University of Virginia, e-books are being used in an experimental English literature course. Graduate student Kristin Jensen is excited by the versatility of her pocket PC.
KRISTEN JENSEN: With the e-books, I don't have to come here to special collections and sign out the book, wait in line with the 18 other people in class, take my turn reading a very rare, valuable old volume. I can take it anywhere. I can read it at home at 1:00 a.m. I can read it at the bus stop.
TERENCE SMITH: The digital library in Jensen's hand allows her to search quickly through huge volumes without feeling the weight.
David Seaman is a director of the Electronic Text Center and a leader in the field.
DAVID SEAMAN: The simple fact that you have all of your books all of the time is beginning to change the dynamic in the classroom in some cases. You can ask questions about things that you haven't read yet because you can pull out your gadget, and there they are.
TERENCE SMITH: At a recent book summit in New York sponsored by Publishers Weekly and Inside magazines, Kirshbaum, whose corporate partner is AOL, the nation's largest Internet service provider, said e-books were already having an impact on his industry.
LAWRENCE KIRSHBAUM: The Internet can match, if you will, buyer and seller much more efficiently than anything that we've had before. So one of the great benefits to publishers in this early-adopter stage of electronic publishing is that we are learning how to find those target audiences of readers.
TERENCE SMITH: Many publishers are convinced that digital ventures such as e-books represent the future of the book business because of the ease of distribution they offer.
LAWRENCE KIRSHBAUM: I'm certainly looking at a timeframe that is no more than five years, where digital books will be a major part of the business, and by major, I mean at least 10 percent, and possibly even 15 percent or 20 percent.
TERENCE SMITH: In contrast to hard-covers, e-books can be constantly updated.
LAWRENCE KIRSHBAUM: Right now a print book has a gestation period that might be anywhere from six months to a year and a half. Well, if you're doing a book on cellular biology, you can't wait a year and a half because the whole landscape is likely to change.
So the idea of putting a book into a digital database and then having it updated periodically and then printed out as you need it is, I think, an enormously appealing one, and these are the key to the future because they will lead us to the ability to distribute content instantaneously all over the world.
TERENCE SMITH: Given the savings, how cheap should e-books be?
LAWRENCE KIRSHBAUM: Well, that is a primary strategic issue publishers face right now. There's no question that somewhere between free distribution, which we of course abhor, and the current print retail prices there's a middle ground. A $35 hard cover will tend to be $16 to $18 when it comes out in an oversized paperback. So that may very well be a model for electronic books as well -- we will try to hit that 50 percent margin.
TERENCE SMITH: Priced at that level or potentially even lower, e-books, M.J. Rose thinks, could mushroom in popularity.
M.J. ROSE: I think e-books eventually will start to replace mass-market paperbacks, but we're five years from that, until we have the devices to read e-books on that are really friendly and comfy.
TERENCE SMITH: Most of the e-book story lies in the future. Promising new devices like the Hiebook, and the Tablet PC are due out later this year. Industry experts say stores will soon have ATM-like devices capable of printing books on demand.
LAWRENCE KIRSHBAUM: You'll be able to print that book out in a store, have it bound right there while you go have a cup of coffee.
TERENCE SMITH: While someday people may read the Bible on something like this, Mr. Gutenberg can still rest easy. Based on current sales, the public’s love affair with page turning and the printed word seems as strong as ever.