RealTime IT News

Bertelsmann Books Euro Launch

German media powerhouse Bertelsmann AG announced Monday its online books division has signed multi-million dollar agreements for European distribution with America Online Inc. and Lycos Inc.

Bertelsmann AG is paying AOL $13 million to be the exclusive bookseller on AOL and CompuServe's European services for the next two years.

Bertelsmann's BooksOnline, or BOL.com, service will be the exclusive bookseller for AOL and CompuServe members in the UK, Germany, France, Spain, the Netherlands and Switzerland once it launches. A company spokeswoman said the BOL.com launch is slated for sometime early next year.

BOL.com expects to offer thousands of book titles in five languages and will provide AOL and CompuServe members in Europe with editorial content and search capabilities to locate books by subject, genre or author. Content and titles will also be customized to local preferences according to country.

BOL's deal with Lycos Europe is an exclusive three-year, $10 million deal. Lycos Europe will offer access and links to BOL.com and its country-specific sites which include the UK, Germany, the Netherlands, France, Spain, Belgium, Luxembourg, Switzerland and Italy. Users of the Lycos search engine will also be able to purchase titles online.

On Oct. 7, Bertelsmann paid $200 million to buy a 50 percent stake in barnesandnoble.com. The terms of that deal also called for both companies to pour $100 million into the site. In addition, Bertelsmann said it would extend some of its U.S. resources to barnesandnoble.com from its previously announced BooksOnline service. At the time, Bertelsmann also said it would continue with separate plans to launch BooksOnline in various European countries.

Chip Austin, President and CEO of BOL.com, said the barnesandnoble.com/BOL.com synergy will unfold in the near future.

"Over time, we'll look to pass customers back and forth. barnesandnoble.com in the U.S. will carry U.S. titles and U.S. rights to those titles. So, if a German customer wanted a U.S. book, he would get it from barnesandnoble.com, not BOL.com, and vice versa."

"We expect to see synergies as far as infrastructure, share warehouses, etc. but we're taking it very slowly," Austin said of the BOL.com/barnesandnoble.com alliance.

Austin said that with Bertelsmann stake in barnesandnoble.com, BOL.com will not compete against it in the U.S.

Austin said today's Euro launch of BOL.com was not so much in reaction to Amazon.com's recent overseas foray but that Bertelsmann viewed it as a "tremendous opportunity" for the 160-year old company to take advantage of what Austin said was currently a $250 million Internet market in Europe, which he said is forecasted to surge to over a billion by the year 2000.