News

News Shorts
Staff -- 10/23/00

Flammarion Sale to Rizzoli, HC Deal For Nobel Works Garner Fair Buzz
Sales, Earnings Rise at Millbrook | Golden Gets Nick License
Bookstore Sales Jump 20% in August | Settlement Reached In 'McNally' Suit
Thomas Nelson Enters E-Book Market | Versaware Acquires Victory Technology
Xlibris Expands to Europe, Asia | Rowling Waves Wand for Charity
B&N Offers Free Internet Access | $3M BOMC Loss In Third Qtr. of '99


Report from Frankfurt
Flammarion Sale to Rizzoli, HC Deal For Nobel Works Garner Fair Buzz
The early buzz at the Frankfurt Book Fair was not about a hot book, but about the acquisition of France's Flammarion, the country's fifth largest trade group, and still family-owned, by Italy's Rizzoli Libri, part of the RCS Group. "This is the saddest news of my career," a French publisher commented as word of the sale spread at an evening party on October 17.

Rizzoli is acquiring 77% of the French house, whose strengths are in general trade, art and medicine, with a leading paperback line and a bookstore chain. Rizzoli has an option to acquire the remaining shares. The total cost to Rizzoli is some 300 billion lire (about $131.5 million at an exchange rate of $1=2280 lire). As part of the deal, Flammarion's president and publisher, Charles-Henri Flammarion, will stay on to run the company.

After the fair opened, HarperCollins acquired North American rights to two works by the winner of this year's Nobel Prize for Literature, Gao Xingjian. V-p and executive editor Terry Karten acquired Soul Mountain and One Man's Bible for what was described as "a fair price." HC hopes to release Soul Mountain, which Karten described as a "rich, earthy work that is both funny and sad," in winter 2001, to coincide with Xingjian's planned visit to the U.S. The author was at the fair; at a packed press conference, he talked about his novels: "The individual human existence is my subject."

A spot check of American exhibitors found that the first morning of the show was slow, but that traffic and business picked up later in the day.
--Herbert R. Lottman & Jim Milliot



Fiscal 2000 Results
Sales, Earnings Rise at Millbrook
After posting a loss of $674,000 for the fiscal year ended July 31, 1999, Millbrook Press rebounded in its most recent fiscal year, reporting net income of $1.1 million. The improvement was the result of a 13.8% increase in revenues, to $21.4 million, and a reduction in operating expenses from $8.1 million to $7.8 million. Sales increased to both Millbrook's school and public library market and its consumer market.


Golden Gets Nick LicenseGolden Books, which has lost a number of licenses to competitors in recent years, turned the tide last week when it became the master Nickelodeon licensee for the color and activity segment of the children's book category. The titles had been published by Landoll.

The license becomes effective October 30, at which time Golden expects to make available books tied into Nickelodeon's Blue's Clues, Rugrats and Wild Thorn-berrys shows. Books related to Nickelodeon's Dora the Explorer, Jimmy Neutron, Little Bill, SpongeBob Square-Pants, Rocket Power and CatDog shows are expected to be released over the next few months. In a letter to customers, Golden notes that any returns of Landoll product should be directed to Landoll; Golden will only take returns that have been purchased from the company.
--Staff


Retailing
Bookstore Sales Jump 20% in August
Retail bookstore sales, which have had a number of solid months in 2000, posted their best month this year in August, when sales climbed 20.2%, to $1.63 billion, according to preliminary estimates from the U.S. Census Bureau. The jump in bookstore sales easily outpaced the 8.9% sales gain recorded by the entire retail segment. For the first eight months of the year, bookstore sales hit $9.58 billion, a gain of 10.2% over the same period in 1999; sales for all of retail were up 9.5% in the January through August span.
--Staff


Litigation
Settlement Reached In 'McNally' Suit
Penguin Putnam and Simon & Schuster have reached a settlement in a class-action lawsuit involving authorship of McNally's Dilemma. The settlement grew out of four lawsuits filed in 1999 alleging that the plaintiffs were deceived into believing that McNally's Dilemma had been written by Lawrence Sanders when in fact it had been written by Vincent Lardo following Sanders's death. Although the copyright page contained the notice that Dilemma had been written by Lardo based on Sanders's Archy McNally character, the jacket featured only Sanders's name.

According to the settlement, which still needs final court approval, consumers are eligible to receive $13 if they purchased the hardcover and $11 if they bought the audio from S&S. As part of the settlement, notices were placed in the October 15 book review sections of the New York Times, Chicago Tribune and Los Angeles Times as well as the October 16 and 17 editions of USAToday, alerting readers that if they qualify for reimbursements, they have until January 15, 2001, to contact the New York office of Beatie and Osborn, the lead counsel for the plaintiffs. Penguin and S&S admitted to no wrongdoing.

The latest book in the McNally series, McNally's Folly, was released this summer with Lardo credited as the author.
--Jim Milliot


E-Books
Thomas Nelson Enters E-Book Market
Thomas Nelson is dipping its t into the e-book waters with plans to release 17 of its bestselling titles in the MS Reader format beginning on November 15. Nelson will follow up its initial efforts by making the titles available in additional formats shortly after the release of the MS Reader titles, said Phil Stoner, Nelson executive v-p and publisher, who is chairing the company's e-book initiative.

The first titles will be drawn from five different Nelson divisions and include Failing Forward, He Chose the Nails, Where to Find It in the Bible, The Gospel of John and My Life As Reindeer Road Kill. Prices are expected to be comparable to that of the print editions. Stoner hopes that a second list of titles will be ready to release before Christmas. Future titles will include backlist titles, specialty works and, eventually, original e-books.

Nelson has not yet established a separate corporate entity to publish e-books; the initial titles were chosen by representatives from the five divisions, and a task force headed by Stoner is coordinating the publishing program. "We want to get in the game and see how things develop," Stoner told PW, adding that Nelson "has a very serious commitment to the e-book market."
--Jim Milliot


Distance Learning
Versaware Acquires Victory Technology
Looking to expand its offerings in the growing field of distance learning, Versaware has acquired Victory Technology, a digital technology company located in Sonoma, Calif., that created and owns MedCollege.com, an online distance-learning site offering accredited courses and multimedia instructional software for emergency medical services professionals. Financial terms were not disclosed.
Harry Fox, CEO of Versaware, said that online distance learning was ideal for the unpredictable work schedules of the more than two million EMS professionals in the U.S. "Victory can now market e-books developed by Versaware to its growing subscription base," said Fox. In addition, Versaware will be able to exploit Victory's expertise in distance learning to provide new business opportunities to Versaware's other print and online publishing clients.
John Stalcup, president of Victory Technology, said that the acquisition would give MedCollege.com "real-time consumer visibility," and allow the firm to "deliver the most technologically advanced online course materials in a wide variety of emergency care areas."
--Staff


POD Services
Xlibris Expands to Europe, Asia
Print-on-Demand and subsidy publisher Xlibris announced plans to expand its services into Europe and Asia in the coming year. The Web-based publishing services provider, which is partly owned by Random House Ventures, has plans for offices in London, Munich and Tokyo.

John Feldcamp, CEO of Xlibris, said the overseas expansion is a "natural evolution" for the online company. "We intend to provide European and Asian authors with the same set of complete publishing services, control of rights and connections to a broad range of resources," Feldcamp said.

Xlibris U.K. will open in early 2001 and will be headed by Pedro Huerta, who has been named managing editor; Brian Bishop has been named to oversee marketing; Cindy Hudson has been named v-p of technology and Web development; Ray Beauchamp will direct author services; and Josh McDowell will serve as manager of production.

The German office in Munich should launch later in 2001. The Tokyo office will also open later in 2001 and will be headed by managing director Henry de La Trobe.
--Staff


Good Deeds
Rowling Waves Wand for Charity
J.K. Rowling has penned two 64-page books--spinoffs from her Harry Potter works--as a fund-raiser for Comic Relief in the U.K., a charitable organization that helps poor and disadvantaged people in Africa and the U.K. Rowling's two new volumes will be called Quidditch Through the Ages and Fantastic Beasts and Where to Find Them.

The titles are a welcome in-joke for Potter fans. In Harry's world, Fantastic Beasts and Where to FindThem is required reading for first-year students at Hogwarts School of Witchcraft and Wizardry, and Harry and pals consult the library book Quidditch Through the Agesto bone up on the history and rules of this high-flying game played on broomsticks.

The titles will be released worldwide (by Scholastic in the U.S., by Bloomsbury everywhere else) on March 16, Comic Relief's Red Nose Day. On Red Nose Day, celebrated every two years, U.K. citizens are encouraged to "throw caution to the wind, cast their inhibitions aside and do something wild to raise money," according to its Web site.
--Shannon Maughan


Retailing
B&N Offers Free Internet Access
Barnes & Noble and Yahoo! have launched a co-branded free Internet service through Spinway, an Internet service provider in Sunnyvale, Calif. The service will provide users with a personalized B&N/My Yahoo! homepage, as well as a standard set of Yahoo! services, such as e-mail and instant messaging.

CD-ROMs containing the software required to log on to the service are being distributed through Barnes & Noble superstores; the software is also available for download from barnesandnoble.com. Earlier this fall B&N.com replaced Amazon. com as the "featured" online bookseller on Yahoo! (News, Sept. 25).

Steve Riggio, vice-chairman of B&N.com, said, "What Barnes & Noble now has is a network which serves tens of millions of regular customers. Our integrated marketing program, powered by Yahoo! and Spinway, provides us with a vehicle that marries our retail-store customers with our Web site."
--Edward Nawotka



Retro Results
$3M BOMC Loss In Third Qtr. of '99
Although financial information about Bookspan, the joint venture between Time Warner and Bertelsmann's book clubs, is not being made public, TW continues to release quarterly information about Book-of-the-Month Club's 1999 performance. For the third quarter ended September 30, 1999, BOMC had sales of $81 million and an operating loss of $3 million. For the first nine months of 1999, the club had revenues of $228 million and an operating loss of $17 million.
--Staff