This article does a good job of summing up the dilemma both Amazon and Barnes and Noble face in selling ebooks - both have dropped the price of their readers today.
I've written in the past about e-books and the problems they face. The argument that would be given today for something like the Kindle would be the extraordinary battery life, and crisp display. The iPad's display is decent, but average (around 95 dpi I would guess). But wait......Apple has just started selling the iPhone 4, which has a much nicer display. It is really just a matter of time before this display technology shows up on the iPad, and at that point it becomes an even harder choice for those trying to decide between the iPad, Kindle and other ereaders.
I am not saying that Amazon's Kindle is doomed, just that their reader's sales growth will slope downwards. Where they will make their money is on their ebook publication, since there is Kindle software for the iPad and other devices.
The Android tablets are already here, and pricing is bound to drop. They will be the iPad's biggest competitor, and unlike the iPhone/Android Phone, they have a very good chance of dominating the tablet market. Apple will have to move quickly with better display technology and more aggressive pricing. As always, the difference will be content, whether it be in textual content or applications. The Kindle lags far behind in the latter.
One final aspect that is worth considering is the book or magazine remediated in digital form. At the end of the day, static books on the Kindle and Nook are a bit more than just a book itself on a device, but on the iPad and other devices publication can be something quite more. Content can be dynamic; it can have interactivity that the Kindle and Nook can't really provide well. These new devices offer the dimension of color, which makes digital magazines much more like their analog equivalents. This is, in my opinion, the overarching reason that e-ink devices are going to suffer. It is akin to the move from black and white to color film. Suddenly, black and white looked dated. It is even more of a problem here in that color publication has been available for centuries.
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