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I do think tablets will definitely affect netbook sales, especially ones like the Asus Slider with a slide out keyboard.
I do think there will be convergence of tablets and ereaders, the same way that PDAs were superseded by smartphones. Very few stand alone PDAs now, but people used to love them.
I don't see it as a size thing or an e-ink vs lcd thing. I have a 7" android tablet and there have been some 5" ones made. So these are a nice size for ereading. Over time, I think screen technology will evolve where the tablet screens will overcome some of the e-ink advantages for straight reading, while preserving the tablet advantages of color, video and web browsing.
It will be some years, but I think it will come.
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