The magazine said the device is likely to be unveiled this year and that other publishers will be allowed to adapt it for their use.

"I can't tell you the details of what we are doing, but I can say we are keenly interested in this, and expect these devices will be a big part of our future," Kenneth Bronfin, Hearst interactive media group chief, told Fortune.

The magazine said Bronfin led an investment by Hearst more than a decade ago in E Ink, a Cambridge, Massachusetts-based company that supplies the electronic-ink technology used in the Kindle and in devices produced by Sony.

"What Hearst and its partners plan to do is sell the e-readers to publishers and to take a cut of the revenue derived from selling magazines and newspapers on these devices," Fortune said.

The magazine said the Hearst e-reader has a large-format screen "suited to the reading and advertising requirements of newspapers and magazines."

It said the device "will approximate the size of a standard sheet of paper, rather than the six-inch (15-centimeter) diagonal screen found on Kindle."

"Given the evolving state of the technology, the Hearst reader is likely to debut in black and white and later transition to high-resolution color with the option for video," Fortune said.

Downloading newspapers and magazines will be done wirelessly, it said.

Hearst owns daily and weekly newspapers, magazines and television stations.

But like other US publishing groups, the firm is suffering from a steep decline in print advertising revenue, falling circulation and the migration of readers to free news online.

Hearst earlier this week announced that one of its flagship newspapers, the San Francisco Chronicle, will be closed or put up for sale unless staffers at the paper agree to "significant" job cuts.

Hearst also announced in January that it plans to close its money-losing Seattle newspaper, the Post-Intelligencer, if a buyer cannot be found.

In addition to the San Francisco and Seattle papers, Hearst owns the Houston Chronicle and other papers as well as magazines including such titles as Good Housekeeping, Cosmopolitan and Esquire.

(c) 2009 AFP