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tablets might replace dedicated eReaders, but smart phones won't. No one wants a giant smart phone screen (imagine holding your iPad to your head for 5-10 minutes), or to read for long periods of time from a tiny screen.
edit: The people I know with iPhones pay around $50/month for theirs - in other words, they could buy a new Kindle or Kobo every two months for that price. Unless phone companies stop being greedy (no chance), then I don't see smart phones winning out over other devices anytime soon.
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