Reports the New York Times:

Unlike Amazon, which sets the retail price for its e-books and sells them in its own proprietary Kindle format, Scribd is offering publishers considerably more control over how their digital titles are sold.

Simon & Schuster will sell its books on Scribd for 20 percent off the list price of the most recent print edition. Amazon sets a price of $9.99 for many popular e-books, meaning titles there might be less expensive. But Scribd will allow publishers to see what is selling and change their prices accordingly.

Scribd also gives publishers 80 percent of revenue. Amazon reportedly gives publishers about half of the list price of books sold for the Kindle, but also discounts many titles and in some cases chooses to make no revenue itself from those sales.

Simon & Schuster will sell its books with anticopying software from Adobe, which means those books can be transferred to devices like the Sony Reader and some mobile phones, but not to Amazon's Kindle.

Since it's already abundantly clear that Kindle is a false prophet for newspapers, would it be safe to assume that if more disgruntled-with-Amazon publishers were to follow suit and partner with Scribd that Amazon might be in big trouble? Because there just might be more deals in the works.

Trip Adler, Scribd's chief executive, says the company is also talking to other major American publishers. "This is the first public endorsement by a major force in publishing that the social Web will play a major role in the future of book sales," Mr. Adler said.

Back in May, after posting significant financial losses, Amazon CEO Jeff Bezos tried desperately to convince shareholders that Kindle needed to be viewed as an investment and not an income generator. How will he spin further losses? Probably with maniacal laughter!

Simon & Schuster to Sell Digital Books on Scribd.com [New York Times]

Graham, who sold a company to Yahoo in the '90s, had become microfamous for Y Combinator, which provided both a social club and seed-stage funding. The summer (and winter) camp for young entrepeneurs spun off any number of companies, which then got venture-capital financing, and then a quick exit courtesy of Google or Yahoo's shareholders.

In the bubbly years when Yahoo and Google were snapping up startups freely, Y Combinator's offspring thrived, or appeared to thrive. Got an online PowerPoint clone? Google will buy it! Graham still seems to be living in his someone-will-buy-it dreamland; he recently proposed that companies hire "chief acquisition officers," to specialize in consuming the fare he dishes out. But the giants of the Web have put acquisitions on hold, and few others are stepping up to the plate.

Is Scribd, once described as Graham's "greatest success," in trouble? We don't know that for sure. We do know that hiring 20 people to create software that lets people post PDF documents to the Web always seemed silly. Having a cocky 20something Harvard grad as CEO may work for Facebook, but we don't think Trip Adler is the next Mark Zuckerberg. But Scribd itself isn't the real story. It's whether Paul Graham's magical startup machine is grinding to a halt.

You guys should cover Scribd's posh anniversary party from Saturday night.

Location: Ariba billionaire Ed Kinsey's "modest" $22 million dollar home. Looks like it belongs to English royalty. His basement houses a stable of vintage sports cars from the '60s through the '90s, from Shelby Cobra to Aston Martin.

Michael Arrington and some of his kids from TechCrunch came, as did Paul Graham from Y Combinator, plus some other bigwigs I didn't recognize.

Trip, Scribd's CEO, looks like he's twelve - and is quite the overconfident Harvard kid. How the VCs let him run a company of 11 people is beyond me.

(Photo by Joey Wan)

The lifecasting site could learn to accept all that is natural about life from its Y Combinator sibling. Of course, Scribd doesn't have to comply with laws requiring extensive verification of the age of porn actors — a requirement that Justin.tv apparently believes applies to its volunteer broadcasters. And Scribd's founders may not be the best role model in other aspects of business. This is, after all, a company that foolishly promised a future management role to all of its early employees. But at least they know what their users want.

If you join Scribd now, you'll have the real startup experience: you'll design the product (not only implement it) and work in a tiny group that accomplishes big things. You'll also get a big equity stake now and a management role later on (unless you don't want it). At the same time, Scribd has raised money from top-tier venture capitalists, so you won't have to live on Ramen...