Starbucks to offer DVDs and books with its skinny latte

Starbucks, which started selling music through its outlets last year, is taking its concept of offering customers entertainment with their coffee a step further with a plan to promote films and sell DVDs and books.

America's largest coffee chain announced a deal yesterday to promote acoming film about a spelling competition.

It also said it was talking to various Hollywood studios about separate deals to sell DVDs alongside the CDs it already offers customers.

The final part of the strategy to move into the entertainment world is to put books on sale later this year, either through a partnership with an existing publishing house or by printing books itself.

The move comes as the Seattle-based Starbucks, which has 5,500 outlets in the US and Canada and 1,500 in the rest of the world, is searching for ways to differentiate itself from rivals in the intensely competitive high street coffee shop market.

In its boldest move since its aggressive international expansion in the mid-1990s, Starbucks surprised Wall Street last March by launching a plan to sell music in its stores, allowing customers to download songs from the internet on to CDs.

To kick off its foray into films, Starbucks will promote Akeelah and the Bee, a story about an 11-year-old from the poor area of south Los Angeles who discovers a passion for words and enters a spelling bee. The film follows the highly successful 2002 documentary Spellbound, which followed eight teenagers on their quest to win the National Spelling Bee competition in the US.

Marketing for the latest film, which will be released in the US in April, will include trivia games on chalkboards and words from the film printed inside pastry cases. It will also be promoted on coffee cup sleeves. In exchange, Starbucks will get an undisclosed share of the film's box-office proceeds.

Howard Schultz, the chairman of Starbucks, said in an interview with The Wall Street Journal: "Starbucks isn't an entertainment company. But we want to have an entertainment strategy that supports the foundation of the coffee experience that our customers have come to expect and enjoy."

Shares in Starbucks fell 16 cents to $30.96 in New York yesterday.