Gemstar-TV Guide International (GMST) took a step closer Thursday to changing the world of books. But don't plan it changing Gemstar's fortunes any time soon.

Gemstar, which cornered the market on simplified VCR operation with its VCR Plus+ system, unveiled some tangible publishing-industry progress for its eBook electronic book system, which consumer electronics manufacturer

Thomson Multimedia

(TMS)

says will debut in

Circuit City

(CC) - Get Report

,

Best Buy

(BBY) - Get Report

and

OfficeMax

(OMX)

after Thanksgiving.

At a Thursday press conference, Gemstar said that six books from best-selling authors at five major publishing houses will be up for sale as eBooks this holiday season -- five of those books ahead of their official print-publication date. Among the novelists whose work will appear on the device are: Patricia Cornwell, Robert Ludlum, Ken Follett and Ed McBain, representing publishers such as

Penguin Putnam

,

TheStreet Recommends

Warner Books

and

Simon & Schuster

.

Palming

Gemstar's eBook operation -- built on the company's purchase of

NuvoMedia

and

Softbook Press

-- aims to build a business by licensing technology and distributing electronic versions of books, which customers read on electronic tablets resembling palm-sized computers enlarged to the dimensions of a hardbound book.

Each eBook, which will be available in two different models from RCA, starts out with enough memory to hold at least a dozen novels at a time. Both will feature built-in modems, so to purchase new books, essentially all owners will have to do is plug the eBook into a phone line, rather than connect through a computer. Downloading a purchased book onto a computer should take about a minute and a half, according to Gemstar. Prices will be determined by publishers, but it's likely that new eBooks will start out costing about the same as their hardbound counterparts.

The support from the publishers appears to indicate that Gemstar has solved one of the classic problems facing companies marketing new technologies -- such as video games and palm-sized computers -- that require both hardware and software: How do you get manufacturers to make a device if there's no content readily available to use on it, and how do you get software makers to create new material for the device if hardly anyone has the hardware?

The Long Term

One longtime Gemstar investor says he's optimistic about eBook's long-term benefits for the company. "I think it will be profitable for Gemstar, but not anytime soon," said Mark Greenberg, portfolio manager of the

(FLISX)

Invesco Leisure fund. It will be 2002 before the eBook has a financial impact bigger than a rounding error, Greenberg predicted.

But beyond that, in a best-case scenario, the payoff could be huge. Gemstar Chairman and CEO Henry Yuen said the company will collect between 10% and 20% of the price of any book sold electronically, with the cut depending on such variables as the author, the publisher and whether Gemstar is selling the book directly to the reader, or the reader is buying it through another company.

Greenberg says he's heartened by Gemstar's past successes, particularly its ability to get newspapers to publish VCR Plus+ taping codes while getting manufacturers to make VCRs with VCR Plus+ technology built in. "What Henry has done well in the past is chicken-and-egg kind of businesses," Greenberg said.

Gemstar was up $2.94, or 5%, to $61.69, at midday Friday.