Oh c'mon... The Kindle is innovative in two big ways:
1) People actually KNOW about it - Amazon has the chops to provide a decent amount of content
2) The insta-purchase option of all those books.
That alone puts it above a lot of the competition for a lot of users. Having been burnt by the ebook gadget a time or two before, I'm very aware of just how crappy a selection was available to me (and Sony certainly didn't improve it much with their new reader.)
Of course, that isn't everything (and personally, I couldn't care less - most of what I rea isn't going to be in anyone's book store)... and I'd agree the iLiad is a more impressive device all around - but there is a lot to be said for kickstarting the market and awareness, and all these devices will sell better once the Kindle becomes more popular because people will go "Oh, I want one of those! Oh... can't find it/too expensive/etc.... this sony one looks nice..."
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