I'll probably end up spending a little more on books once that I have a Kindle, but I'm going to try buying myself a monthly "book budget" gift card to keep that to a minimum.
I hardly ever buy hardbacks, and when I do I usually use coupons or discount cards. There's at least one author that I'm probably going to continue getting in hardcover, because I wanted an e-book reader to streamline my physical library rather than replace it.
I also rarely buy books in the trade paperback format, because I'm stubborn and I don't like it much for novels. I don't like paying more for a style of book that I find less convenient to carry around and more awkward to shelve. I guess I've been lucky, because the only times that I've come across the durability issues that some people report with mass markets have been the few that have been read many, many times by two older brothers before being passed down to me. So that's the format I've preferred for most of my entertainment reading.
With a Kindle, I'll probably end up buying a lot more e-books in the trade paperback price range. I'll also probably buy more of the $9.99 new books, but I'm not sure if I'll end up buying many novels above the $10 - $12. I currently get a lot of hardcovers from my library, but the added convenience of Kindle books may end up changing that.
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