I think that article is intentionally inflammatory, but is largely based on the truth. KFX is a totally proprietary format. Amazon went out of their way to avoid using EPUB, HTML, and any other standard related to e-books in KFX.
Every book in KFX format has DRM, even if the publisher opted out of it. On top of that when a method of removing KFX DRM became available Amazon quickly moved to update their DRM to prevent its removal. I have seen other signs that indicate they are serious about keeping KFX DRM intact in the future.
So while KFX provides improved ebook rendering on Kindle devices it also serves Amazon's desire for lock in to their proprietary ecosystem. What I still can't figure out is why they haven't taken steps to close the DRM loopholes in their other formats. I suspect that will happen at some point.
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