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Well, after reading what's been said here and what you can learn about the 700 at Sonystyle, I think this is an altogether new concept (for Sony). This is in no way a better 505. IMHO it is actually a worse one with some extras that depending on how useful they are to you, might tilt the balance.
There is nothing about the 700 that can improve the reading experience, except for the light. This you'll end up paying by shorter battery life (battery seems to be the same as in the 505, so just no way you can read the same in both). In any case, I solved that problem with an external light long ago and I consider that difference non-exixtent for my daily use of the reader. The 700 is a little heavier but the weight difference is negligible.
When reading fiction, I can find no need for the touchscreen having the hardware buttons of the 505, but I could use the hardware buttons of the 505 on the 700 even if I had the touchscreen. To me, this is the main difference between both interfaces and it is capital. Worse than that, the existing buttons of the 700 are inline with others exactly the same as them and in a not too good position for one (left) handed reading. Right handed reading can't be done unless you release your thumb and slide it along the screen. Many 700 are going to get dropped this way.
The possible dictionary application is the best novelty of the 700. Certainly not enough, in my case, to pay even the same as for the 505 and exchange it for the hardware buttons.
Page turn seems to be faster, but that is no real advantage, being the turn speed of the 505 already pretty good.
So, for whoever needs highlighting text, uses dictionaries all the time or has a whim for a built in light system, this could be a great gadget. For me, it is another product, far from an upgrade, that offers no advantages to me in actual reading (same screen tech and size, with the same 8 shades of gray), and seems actually less comfortable when turning pages in all positions.
Conclusion: I would only buy it if it was far cheaper than the 505. And that only if I was short of money.
As far as I can see, this could have two effects on the 505.
1.- Lower it's price. That is a sensible thing to expect in the medium term and is perfect for me as I have no intention of replacing a 505 with a 700 whatsoever.
2.- Depending on how different their software modules are, Sony might forget about upgrading 505 firmware any more. This I find no mayor issue, since, the way it performs now, the 505 is just perfect for me.
Who knows, maybe this is a test from Sony to check how a touchscreen would be received on their way to competing with Illiad.
It would surprise me none if they release a 510 next year.
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