Starz, Penguin launch TV-book tie-up on iPad

An Apple iPad is displayed during an iPad launch event at the Apple retail store in San Francisco, California April 3, 2010.

LOS ANGELES (Reuters) - Penguin launched on Tuesday the first electronic book with a video tie-in, as the embattled book publishing industry bets on multimedia ebooks to revive flagging growth and boost readership.

Penguin Group Inc and Liberty Media's Starz Media began selling the first version -- for Apple Inc's iPad -- of a novel with accompanying video from a TV mini-series based on the same tome.

The deal could serve as a model for other cross-media partnerships, executives say.

Priced at $12.99, above the $9.99 industry norm for ebooks, Penguin's iPad version of Ken Follett's 12th century England epic "The Pillars of the Earth" will let users read the novel and watch scenes from the mini-series, which airs July 23.

Publishers are hoping the iPad will help make electronic books more profitable. While sales of ebooks have risen fast, publishers have griped about market leader Amazon.com Inc's practice of selling books at a loss at $9.99 each to gain market share and boost sales of its own Kindle e-reader.

"Publishers are seeking ways to provide additional value to consumers, so they can charge more for digital content. They don't want the $9.99 price point to stick," said Sarah Rotman Epps, an analyst with Forrester research.

The research outfit forecasts U.S. consumers will spend $966 million on ebooks in 2010, swelling to $2.8 billion in 2015.

"This is a combined effort of a video company and publishing company. Penguin felt this deserved a higher price point with the integration of video," said Marc DeBevoise, senior vice president of digital media business development for Starz.

For entertainment companies like Starz, he said the venture reflects a new way of using e-readers like the iPad for marketing and advertising.

The effort is similar to one recently executed by CBS's Showtime, but DeBevoise said Starz and Penguin took it one step further by including video.

Showtime recently offered a free download of a pilot script for its "Nurse Jackie" series on Amazon.com Inc's Kindle, and urged readers to watch the premiere.

"This is the future of books and are looking at it predominantly as a promotional effort," said DeBevoise.

Penguin said it was talking with other partners and hopes to roll out similar projects.

"It's another way to bring more readers to Ken Follett. We're looking at other appropriate books for this kind of experiment and innovation," said Molly Barton, director of business development for Penguin Group USA.

Follett's 1989 book has already sold more than 14 million copies worldwide, enjoying more recent popularity after TV talk queen Oprah Winfrey selected it for the Oprah Book Club in 2007.

In addition to clips from the $40 million Starz mini-series, the ebook edition will offer videos of Follett discussing his writing process, and a character tree that helps readers navigate the book's many personalities.

Updates to the application will occur throughout the airing of the TV series.

(Editing by Bernard Orr and Tim Dobbyn)