Five of the largest companies in the print business are testing the digital waters together. Rather than yield their content to alien formats, Time Inc. (TWX), News Corp. (NWS), Conde Nast, Hearst and Meredith Corp. have announced plans to develop a digital content format of their own. This new product would compete with the newly released Nook from Barnes & Noble (BKS), as well as one from Sony (SNE) and the industry-leading Kindle from Amazon (AMZN). The new e-reader content will come in color and in a format that would work across several devices.
The five media companies are equal partners in this joint venture, which will allow publishers to set their own prices for their content -- an obvious response to what they see as unfavorable revenue share deals offered by Amazon earlier this year. Rupert Murdoch has been particularly vocal on this issue, particularly about the fact that News Corp. only receives a little more than a third of the $14.99 a month it costs to subscribe to the Wall Street Journal on a Kindle. He says of the device that it's "a fantastic invention for reading books. It is not much of an experience for newspapers."
This new venture plans to start selling content starting in 2010. The content would be available for a wide range of devices, including smart phones, tablet computers and e-readers, according to John Squires, the interim managing director of this effort.
"The genesis of this idea," he says, "is to build a fully featured kind of immersive e-reading application that can render our content beautifully on those devices that come to market."
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