Media moguls partner to form new e-book publisher

Two powerful entertainment media figures have joined forces on a new entrant in the e-book publishing sector.

IAC Chairman Barry Diller and movie producer Scott Rudin have partnered on a new venture called Brightline, according to The New York Times. The pair, which have been rumored to be discussing a partnership since July, will publish e-books in conjunction with Atavist, a publisher specializing in e-books and electronic articles.

Diller, the former Fox executive credited with turning Fox Broadcasting into a major network, said he sees opportunity in the turbulent sector, which had $282 million in e-book revenue in the first quarter of 2012, according to the Association of American Publishers.

"The book business has a concentrated number of players and is unquestionably in transition," Diller told the newspaper. "There is a possibility here that if we start with a blank piece of paper that you could hit the opportunity that exists in the book business now."

Diller and Rudin will be going up against Amazon, which dominates e-book sales with 65 percent of the market. The Internet retail giant recently spiced up the competition by announcing that it had inked a deal with a book distributor that will allow Amazon competitors such as Apple and Barnes & Noble to sell Amazon titles.

The industry itself has been in a state of flux -- sometimes bitterly so -- since April, when federal prosecutors accused Apple and five book publishers of conspiring to artificially hike prices. While three publishers agreed to settlements, Apple denied the charges and accused Amazon of being the "driving force" behind the prosecution.