Gemstar-TV Guide International, which entered the e-book business in early 2000 with the acquisitions of NuvoMedia and SoftBook, is "ramping down" that business, a spokesperson confirmed, although he had no comment on what presence Gemstar would maintain in the e-book industry.
The decision to downsize its e-book group came after Gemstar had explored a number of strategic options for the unit, but failed to find a joint venture partner or a buyer. The fate of the unit had been in question ever since Henry Yuen, an e-book champion, was forced to resign as Gemstar chairman last fall and his successor, Jeff Shell, said he would consider selling the division.
The e-book unit never generated significant revenue for its parent company. For the first quarter ended March 31, e-book sales were $1.6 million, down from $1.7 million in the comparable period in 2002. Gemstar generates sales through licensing its technology, the sale of devices and royalties from the sale of e-books that are sold through Gemstar's proprietary system. Gemstar had tried to carve a niche for itself in the e-book world by offering a system that was dedicated to running only e-books, an approach which increased protection against piracy, but limited the number of possible consumers for e-books to only those who owned Gemstar devices. As limited as that approach was, the potential for e-book sales through Gemstar was large enough to draw a number of publishing heavyweights—Larry Kirshbaum, Jane Friedman, Phyllis Grann and Richard Sarnoff—to an October 2000 press conference that launched the new generation of Gemstar devices (News, Oct. 16, 2000).
