Children's book market ready to embrace a digital world

After he's finished his homework and his chores for the day, 8-year-old Skye Vaughn-Perlin likes to read Dr. Seuss. He's a particular fan of the high jinks that ensue when the elephant Horton hears voices emanating from a dust speck in "Horton Hears a Who."

He doesn't have a dog-eared copy of the children's classic, though. Skye, from Agoura Hills, Calif., often reads on his computer, pressing the arrow button when he wants to turn a page. Sometimes the characters move around on the screen like animated TV cartoons.

Skye can even have the computer read a book to him while he's curled up in bed.

"It's a whole new level of exploring the books," said mom Victoria Vaughn-Perlin.

Readers and publishers alike are embracing a digital future. Electronic-book sales increased 73 percent in October compared with the same month last year, according to the Association of American Publishers, while sales of adult paperbacks decreased 23 percent and children's paperbacks decreased 14.8 percent.

"There's a new excitement that e-books will become a viable way for consumers to purchase and read books," said David Langevin, vice president and director of electronic markets at Houghton Mifflin Harcourt Publishing.

The children's book market is especially ripe for the wonders of the digital world.

Today's kids, after all, are growing up around technology and don't think twice about learning from computers and sleeping with their iPods. In some cases, watching a book on a computer might even make them enjoy reading more, publishers say.

Businesses are starting to focus on the children's market. Kidthing, a Los Angeles company, makes the digital download that lets Skye read "Horton"; Speakaboos, a New York company, makes audio versions of children's classics available online.

Now publishers are rushing to put content online and create games, and in some cases, whole virtual worlds, about different books.

For many, it's a way to generate revenue and shift to a format that in the long run isn't as expensive as print. But it's also a recognition that children live in their own wired world, and that digital releases can help print sales.

"You have to fish where the fish are," said Chip Flaherty, publisher of Walden Media. Over the summer, Walden released teen book "Savvy" free for a week on the Internet before it went on sale in print and encouraged kids to download the book or read it online. More than 30 tween Web sites and virtual worlds posted a link to the download site, and thanks in part to word-of-mouth, the book climbed to the top of The New York Times best-seller list.

Walden Media said recently it was working with HarperCollins and Woogi World, a virtual world for kids, to make some books available online and start a club that would send kids physical books in the mail. Children will be able to log on to the virtual world, where they can discuss books.

Publishers such as Scholastic are also adding Web sites and games online to go hand in hand with book offerings such as "39 Clues," a 10-volume mystery-book project.

"We can't just ignore that kids are spending more time on the Internet — we want to use the Internet to let them know there is still great content out there," Flaherty said.

Kids are more likely than adults to interact with material on the Web, said Diane Naughton, vice president of marketing at HarperCollins Children's Books. That publishing house has made 25,000 titles such as Lemony Snicket's "The Lump of Coal" available digitally. Readers can browse them online or in some cases read them in full free.

There is some evidence that younger children learn less when they're reading books in electronic form. Kathy Hirsh-Pasek, a professor of psychology at Temple University, studied parents who read digital books with their children and found that young children don't get meaning from what they're reading when they're playing with gadgets and distracted by all the bells and whistles of technology.

"We have to be careful that electronic media is not a substitute for hands-on," she said.

Kids who spend too much time staring at screens instead of imagining fanciful stories in their heads or playing with friends miss out on hands-on creative play, an essential part of a child's development, said Susan Linn, associate director of the media center at Boston's Judge Baker Children's Center.

"It's a problem because it means they're not exploring the world themselves," she said.

Publishers counter that digital books can attract kids to titles they otherwise might not see.

In any case, with the publishing industry weak, digital books are unlikely to go away because they are generating revenue. With digital books, there are no shipping, printing or return costs — which eat into profits.

The sector is Random House's fastest growing, and the publishing behemoth recently announced that it was nearly doubling the number of digital books available.

That will require a big investment, but Matt Shatz, vice president of Random House Digital, said it would pay off in the long run.

"The revenue opportunity that's available for publishers who make the effort is at a point where you can pretty easily justify the cost to convert the files," he said. "That hasn't been true until this year."

Langevin, of Houghton Mifflin, said that though digital books make up just 1 percent of sales, that could easily grow to 10 percent in five years.