One of the many things the iPad can do is function as an electronic book reader, like the Amazon Kindle. Steve Jobs acknowledged the Kindle's success yesterday, and now he wants his product to compete. Publishers are paying attention, as NPR's Lynn Neary reports.

LYNN NEARY: Publishers are happy to have their products on the iBookstore shelves, because partnering with a behemoth like Apple gives them the clout they need to counter Amazon's virtual monopoly on e-book sales. So it wasn't too surprising that most of the big publishing houses had struck a deal with Apple.

Mr. STEVE JOBS (CEO, Apple): And we've got five of the largest publishers in the world that are supporting us on this and are going to have all their books on the store. And we're going to open up the floodgates for the rest of the publishers in the world starting this afternoon.

NEARY: Hachette, Simon and Shuster, HarperCollins, McMillan and Penguin have all signed on with Apple.

Unlike other e-book readers, iBooks can have full color illustrations and photographs, video embeds with author interviews, even lectures and links to other sites. David Young, the CEO of Hachette, says the technology is exciting.

Mr. DAVID YOUNG (CEO, Hachette): Because of the technology being used, of course we can now show our color books, our illustrated books, our cookery titles, our photography titles, through this digital medium, which really is possible by the grayscales of any ink device.

NEARY: Like Amazon, Apple has a store where its books can be sold. But Amazon has set the price for e-books in its store at 9.99, which publishers felt was too low. Young says Hachette has worked out a deal with Apple that puts the pricing power back in the hands of the publishers. Under what is called the Agency Model, the publisher will set the price for a book and Apple will take a commission.

Mr. YOUNG: What we'll get back is a better equilibrium, I think. There was no future, as I saw it, at 9.99 other than ruin. So I'm very glad that this new device coming on the market has enabled us to do something that we've been contemplating for a number of months and indeed discussing with many of our existing e-book retailers.

NEARY: The only major publisher that did not make a deal with Apple is Random House, which issued a statement saying they're continuing conversations with the company about how they might best work together.

Lynn Neary, NPR News, Washington.

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