I voted that it will reduce illegal copying.
As other well written essays explained (linked from forums herein), illegal copying is directly proprtional to the price. Book costing $1,000 will be stolen much more often than the one costing $1. Devices such as Kindle are not that significant. Plenty of students were copying expensive textbooks on Xerox machines decades ago. Of course, Kindle like Sony Reader and others do make it easier. However, there are other means. Given a high enough price, people will find ways even without using eReaders.
Thus the real question is where are book prices headed? I am guessing that Kindle's ease of use and access to eBooks will drive higher sales volume for eBooks which in turn will cause lower prices (higher volume, lower prices). In fact, all the readers combined will drive more volume. Just as Apple generated a lot of volume that gave it significant pricing power, so will happend with eBooks. If they do generate enough volume, Amazon could also lower prices just as Apple did for music.
In that case, sub-$10 price for a book will simply be too low for most readers to bother with illegal means of obtaining books. Once an average book costs less than a single meal then most people will simply download legal books from Amazon and others.
All that being said, there are still a couple of problems. Kindle is too expensive (today). I don't think it will sell enough volume to become as ubiqutous as iPods. Not even close. Especially if US goes into recession. So it may take some (long) time for reader devices to achieve a widespread use and drive the eBook sales volume.
As the other post noted (Kindle is the worst thing that could happend to ebooks) this fragmented market of many formats and DRM schemes will confuse consumers and hold back sales. Consider the latest video format HD vs BluRay, which is only 2 formats, much less than eBooks, yet still sales of discs are very low. Again for simple ease of use we need a single format akin to PDF that would be widely supported. Similarly odd DRM restrictions can also reduce sales.
Thus while Kindle and Amazon will help drive sales, there are still a lot of barriers to wide adoption and lower prices that will more or less kill illegal copying.
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