Microsoft Collaborates with barnesandnoble.com to Accelerate Availability of eBooks

LAS VEGAS, Jan. 6, 2000 —
Joining forces to bring electronic books one step closer to millions of readers around the world, Microsoft and barnesandnoble.com today announced an agreement in which barnesandnoble.com, one of the world’s largest Web sites, will sell thousands of electronic book titles online using Microsoft Reader software. As described by Microsoft Chairman and CEO Bill Gates during his keynote address at the Consumer Electronics Show in Las Vegas, the agreement complements a broader company vision of how Microsoft software works to make technology more useful as well as more personal for consumers, whether they are at home or on the go.

Under the terms of the agreement, barnesandnoble.com will create a unique eBook
“Super Store”
on its Web site, devoted exclusively to selling thousands of books using Microsoft Reader software. Under another agreement, Barnes & Noble, Inc. will aggressively market the new eBookstore through a variety of promotional activities in its more than 1,000 retail bookstores nationwide.

“Through its retail stores and Web site, Barnes & Noble has the ability to distribute eBooks better than any company on earth,”
said Dick Brass, vice president of Technology Development for Microsoft.
“Their involvement and enthusiastic support of the eBook industry is essential to its success. You can’t sell a product unless there’s a place to buy it, and Barnes & Noble provides the final link in the purchasing chain. The authors and publishers provide the books; our publishing partners help prepare the books for publication; Microsoft Reader technology provides a paper-like way to read books on screen; and, finally, Barnes & Noble and barnesandnoble.com provide the place to buy the eBooks and ePeriodicals.”

Microsoft Reader is a new software application for PCs and handheld devices that delivers an on-screen computer reading experience that, for the first time, approaches the quality of paper. Microsoft Reader is the first product to include ClearType display technology, a Microsoft innovation that greatly improves font resolution on LCD screens for users of the Windows and Windows CE operating systems. ClearType significantly improves the clarity of type on the screen, making electronic books as easy to read as books on paper.

“This collaboration of leaders in technology and bookselling will encourage a new era in publishing, and we envision a time in the very near future when there will be electronic versions of every book in print,”
said Steve Riggio, vice chairman of Barnes & Noble, Inc.
“The technology of Microsoft Reader provides a superior reading experience for existing content, and more important, will generate an exciting wave of electronic publishing that will go far beyond books. barnesandnoble.com intends to be the portal through which this dynamic market expands.”

Focused largely on the sale of books, music, software, magazines, prints, posters and related products, barnesandnoble.com is the second largest, and one of the fastest growing, online distributors of books. barnesandnoble.com has the largest standing inventory of any online bookseller.

Barnes & Noble, Inc., the nation’s largest bookseller, operates 528 Barnes & Noble and 444 B. Dalton bookstores, and Babbage’s Etc., one of the largest U.S. operators of video game and entertainment software stores.

Barnes & Noble retail outlets stock an authoritative selection of book titles and provide access to more than one million titles. The stores offer books from more than 50,000 publisher imprints with an emphasis on small, independent publishers and university presses. Barnes & Noble also publishes books under its own imprint for exclusive sale through its retail stores, mail-order catalogs, and Web site.

The unveiling of the barnesandnoble.com eBookstore is expected by mid-year. Pricing for individual eBook titles using Microsoft Reader has not yet been established.

Microsoft Reader will be featured on Microsoft’s new Pocket PC, which was previewed at the Consumer Electronics Show and is expected to ship in the first half of this year. The Pocket PC comes with the next generation of Windows software for a range of advanced personal digital assistants (PDAs) that expands the functionality and accessibility of today’s typical PDA device.

“The extreme clarity of ClearType combined with the”
pocket-ability
“of the Pocket PC format allowed us to create a shirt-pocket eBook with better reading quality than some paperback books and with the capability to store as many as 500 titles. Basically, with the Pocket PC you’ll have a library in your shirt pocket with great reading capability. In fact, when one of our research scientists saw it, he said ‘this is the viewer from Star Trek,'”
said Brass.

In addition to incorporating the latest ClearType technology, Microsoft Reader strictly adheres to the traditions and benefits of fine typography. It provides a clean, uncluttered display; ample margins; full justification; proper spacing, leading and kerning; and powerful tools for bookmarking, highlighting and annotation. Microsoft Reader also includes a dictionary as well as a library that can store and manage a large collection of books and other documents.

Microsoft and Barnes & Noble collaborated previously with a wide range of publishers, printers, eBook pioneers, software and hardware manufacturers, book distributors and retailers to establish an Open eBook standard that will make it possible to read any eBook from any computer device. According to Brass, it was critical for the success of the eBook industry to unite and provide publishers and consumers with a common standard to which all eBooks could be formatted. Without a common standard, publishers would have to format eBook titles separately for each electronic device. The Open eBook standard was announced in September at the second annual eBook conference sponsored by the U.S. Department of Commerce.

Within the last several months, an influential group of European publishers have announced plans to launch their eBook efforts using the Microsoft Reader platform. They include: Spain’s largest publisher, Planeta Actimedia; Italy’s largest business publisher, Il Sole 24 Ore; France’s largest publisher, the Havas Group; Italy’s largest publisher, Arnoldo Mondadori Editore SpA; Penguin Ltd., the largest publisher of classic titles in the United Kingdom and the U.S.; and Editions 00h00.com SA, France’s first online publisher of electronic books.

Microsoft also recently announced an agreement with RR Donnelley, North America’s leading integrated content manager and printer of books, magazines, catalogs, directories and financial information, under which the company plans to use Microsoft Reader software to create a massive repository of tens of thousands of electronic book titles. RR Donnelley plans to make its
“virtual storehouse”
the central point for the production and distribution of electronic book titles from top U.S. publishers to top U.S. online retailers.

“This is an attempt to introduce end-to-end e-commerce. The delivery is instant; there is no warehousing; there are no returns; all the physicality has been removed from the process. And yet we hope, through Barnes & Noble’s participation, that the eBook shopping experience will be more or less identical to what people are already doing to purchase paper books online. The difference will come at the moment of purchase when the customer, hopefully delighted, discovers that their purchase is instantly in their machine,”
said Brass.