*sigh*
Good technologies rarely go away. For every highly touted example (e.g. PDA into Smartphone), there are numerous counter-examples: Radios, video game consoles, fax machines, scanners, photocopiers, DVD players, amplifiers, home theater receivers could all be rolled into a single home theater PC. Hasn't happened yet.
In the interim, devices like the Kindle are cheaper, lighter, are less distracting, have 15x longer battery lives, and (arguably) better screens for plain ol' reading.
And if the personal anecdote is of any use, my iPad has been gathering dust ever since I finished
Plants vs Zombies. The larger screen is OK for reading, but the anti-aliasing on the text sucks, it's too heavy and bulky to read on the subway, and the cost of a Kindle 3 is the same as 1 year of low-end 3g service for the iPad. I have yet to really need to utilize the big advantage of the iPad, namely the ability to buy ebooks from multiple vendors.
More critically, the author of the article fails to understand that not all book purchasers are created equal. 50% of punters buy 10 books or less per year; people who buy more than that are increasingly likely to want a device that is optimized for reading -- and generate a disproportionate amount of the industry's revenues.
Apple has a lot of work to do before it blasts the Kindle out of the water.