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The Sony PRS505 is a very nice reader. I can't compare it to the Kindle as I don't have one, but I am very happy with my Sony.
There is a lot of content available or convertable for it - you just need to look outside the Sony store. Booksonboard.com and fictionwise.com are favourites with many people here, and there are others. There are also plenty of knowledgable and helpful people here should you need to convert anything, and as has been mentioned, Calibre is a very useful program.
If you like the Sony, go for it.
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