In a few months when best-selling author Dan Brown's new book The Lost Symbol hits Borders, chances are some customers will be stepping into the chain's British stores to buy the e-book and a reader instead of the hardcover book.

Last week, Borders U.K. introduced a £189 ($276) e-book reader called Elonex. The Elonex will come pre-loaded with about 1,000 books and will support both the open-source ePub and proprietary Adobe formats. It will be "completely compatible" with the 45,000 odd e-books sold through the Borders website, says the company.

"Digital bookselling is still in its infancy but we believe it is here to stay," says Peter Newbould, commercial director at Borders. "By launching the e-book reader, we hope to bring new customers into the market."

Borders is not the only big chain store to embrace the e-book reader trend. Its biggest competitor Barnes & Noble is reportedly working on introducing an e-book reader of its own. And online, Amazon.com – which once called itself "Earth's biggest bookstore" – has scored a hit with the most popular e-book reader to date, the Kindle, enabling it to generate an estimated $310 million in revenue.

"The big book stores are seeing Amazon take more and more market share of digital book sales," says Sarah Rotman-Epps, an analyst with Forrester Research. "E-books are a small part of the market but it is one of the growth areas and retailers don't want to stand back and let Amazon get ahead."

Since Amazon introduced the Kindle in 2007, e-reader and e-books sales have exploded. In May, E Ink, which almost exclusively supplies the black-and-white displays that power most e-readers said more than a million readers use its technology. Though still a small percentage of overall book sales, e-books have been one of the fastest growing segments in the market. Book sales fell to $24.3 billion in 2008 from $25 billion the year before, e-book sales nearly doubled to $117 million in 2008 from $67 million, a year ago.

Borders U.K. hasn't created its Elonex e-reader. Instead it is selling a device manufactured by Taiwanese company Netronix and re-branded by Elonex, a U.K.-based computer and IT services firm. Borders will also offer a discount coupon booklet on e-books for the Elonex e-reader customers. Earliers, Borders U.K. offered an e-book reader called iLiad for £399 ($555).

It's a clever strategy to get a foothold in a growing market, says Forrester's Epps. "Borders is smart to take advantage of an existing product that they can piggyback on to get a device into the market," she says. "Developing your own device is very time consuming and expensive."

The moves by Borders and in the future by Barnes & Nobles is also attempt to stave off a fate that music retail stores have faced as records went digital, says Epps. Still the transition is unlikely to be easy.

"It's not a pretty picture right now for brick-and-mortar retailers," says Epps. "E-books sales are growing but they can't nearly bring in the same kind of revenue as physical books do," she says.

Meanwhile, e-book readers promoted by big stores could also widen the gap between chain stores and independent book sellers who may not be able to offer an integrated e-book reading experience.

Survival is an issue for indie stores, agrees Stephanie Anderson, manager of a Brooklyn-based book store called Word. But she says stores like hers hold a few trump cards.

"A lot of what independent book stores are about is a place for people to go, meet authors and talk about what they are reading," she says. " For indies, the books are the most important thing but the community comes a close second."

And then there are some books such as children's books and cook books, says Anderson, where the paper counterparts are likely to outsell their digital namesakes. "You can drop those into the bathtub or spill some sauce on it without it going bust," she says.

An e-reader may not be for everyone but Borders is hoping inexpensive e-book readers widely available in retail stores could tempt some skeptics such as Russ Marshalek, a freelance publicist. Marshalek doesn't own a e-reader and says he is a strong supporter of indie stores. "I very consciously shop independent book stores," he says, "and will drive out of my way to get to one."

Yet Marshalek would be open to buying an e-reader that's priced right, even if it comes from a Borders or a Barnes & Noble. Throw in a members discount for e-books bought from their store and Marshalek concedes he could be hooked.

"It could impact my impulse buy," he says, "especially if they have in-store promotions and offers."

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Photo: Borders Elonex E-Book Reader/Elonex