Information technology is about to cross a major milestone. According to IBM's research, by 2005 more than half of the information used worldwide will be in digital form. For the past 5 years, the number of digital encyclopedias sold has surpassed the number of hardcover encyclopedias sold. So with or without pervasive broadband connectivity, the demographics are right to move the bulk of what we read in our everyday lives—newspapers, magazines, and books—into digital form.

In the November 1999 issue of The Economist, Bill Gates, Microsoft chairman and chief software architect, said, "Reading on paper is so much a part of our lives that it's hard to imagine anything can ever replace inky marks on shredded trees.... So how can anyone believe that sales of electronic books will equal those of paper books within a decade or so?" But you better believe it. During the National Institute of Standards and Technology (NIST) conference on e-books, officials predicted that electronic publishing will reach $70 billion a year before the decade is out.

Microsoft believes the emergence of a digital consumer e-book standard will be one of the most important advancements of this decade. In September 1999, Microsoft and the Open Electronic Book Forum (OEBF) announced the Open eBook Publication Structure Specification for e-books, which is available as a free download for software and hardware vendors at http://www.openebook.org. The Open eBook (OEB) specification grew out of a proposal from Dick Brass, Microsoft vice president for technology development, at the NIST conference.

E-books conforming to this specification display text in the next-generation format for handheld and tablet devices and use Microsoft Reader software. The OEB format uses HTML and XML specifications for page markup and layout. XML lets the content and the data presentation remain separate. An OEB file is a package file, and an OEB-conformant device removes the wrapper and interprets the content. The OEB format lets many different devices read from it, and unlike formats such as Adobe Systems' Portable Document Format (PDF), text formatted in the OEB file type can reflow to fit different devices—particularly small devices.

Microsoft has also developed a font display technology called ClearType that will make reading long text passages on the screen easier. Microsoft patented this technology, which manipulates the red, green, and blue subpixels on an LCD screen to make the resulting color pixel appear three times as sharp as with current technology. The resolution of text on paper makes reading books easier than reading text on screen; ClearType technology narrows this gap. This technology requires special fonts, and Microsoft is building ClearType typefaces to support the product.

Microsoft hopes Microsoft Reader, ClearType, and the OEB standard will make it easier for publishers to prepare content that looks good on a variety of devices. Brass said, "We want publishers to be able to format their titles one way so that it won't be necessary to format each book for every device and every reading software program available." He continued, "By adhering to Open eBook standards, publishers can format the content once, and it'll be readable on all major eBook devices or with all major eBook software."

At the October 1999 Frankfurt Book Fair, Penguin Books announced plans to release classic titles on CD-ROM this year. These OEB-compliant titles will use Microsoft Reader to make them available on standard PCs. Subsequently, many company announcements (e.g., barnesandnoble.com's creation of an e-book superstore and R. R. Donnelley and Sons' e-book business) revealed plans to use Microsoft Reader. A significant announcement from Microsoft stated that Microsoft Reader with ClearType will appear on Pocket PCs, thus giving Pocket PCs unique value in comparison with handheld competitors.

Microsoft is providing new Microsoft Reader capabilities, building customized typefaces for ClearType, and working with more than 40 industry leaders and publishers to promote the OEB standard. The standard will eventually let users download any e-book onto hardware devices and overcome incompatibility problems that have prevented customers from receiving content not developed specifically for their reading device.

E-books offer many advantages over paper books and will completely change today's publishing model. With e-books, publishers have an electronic delivery system and users have compact storage. Experts estimate that a current laptop can hold about 30,000 books. Users can order e-books at any time, and e-books will never go out of print because they don't require a costly printing process. But the major innovations that e-books offer are the ability to link material, provide multiple paths of access through the material, allow enhanced search and retrieval, and provide easy user customization. Readers with poor eyesight can enlarge the text, and blind readers can configure the book to read aloud to them. All these factors make e-books an almost certain bet, and Microsoft's timing for an initiative in this market couldn't be better.