Lulu steps up to the giants

Staff WriterNovember 4, 2009 is taking on

The Raleigh-based online book publisher is now selling electronic books by traditional authors, expanding beyond its lineup of self-published titles for the first time.

By offering 200,000 titles from popular authors such as Dan Brown and Malcolm Gladwell, Lulu is trying to attract more mainstream book browsers.

But the strategy also puts Lulu in more direct competition with the world's biggest book sellers.

"As we get more selection on Lulu, we become more relevant to all kinds of readers," said Harish Abbott, senior vice president of products.

Lulu was founded by Bob Young, who relishes playing an underdog role and taking on bigger corporations. Young was the former CEO of Red Hat, the Raleigh company that is the world's largest distributor of Linux open-source software -- and a rival for Microsoft.

With e-books, Lulu will have a tough challenge cracking a small but growing market controlled by Amazon, Google and Barnes & Noble, said Stephen Ju, an analyst with RBC Capital Markets in New York.

Lulu's shift to add mainstream e-books comes as Amazon and Walmart are waging a price war for hardcover bestsellers, offering new books such as John Grisham's "Ford County" for $9. The dramatic discounts could reshape the publishing market.

But Lulu is counting on the traditional titles to draw readers who stumble across unknown authors, Abbott said. For example, someone searching for books on golf might find a book about golf courses in Raleigh.

"As that happens, we'll give Lulu authors a better chance to sell more books because there will be more eyeballs," he said.

Lulu is now publishing nearly 15,000 new titles a month. It will add more mainstream e-book titles as publishers make digital editions available.

The private company with about 130 employees doesn't disclose specific financial results, but officials have said it is profitable. Lulu collects fees for the books it publishes and sells various services for authors.

Lulu also is launching other ways of boosting interest in its products amid the recession. That includes a recent deal with Yahoo that made Lulu's weRead, a social network application that helps readers find new authors and books, available on the popular online destination. or 919-829-4572

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