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I disagree most ebooks text only are from 500k-1.5 MB. You convert that to an image format, you are going to have ebooks from 50MB-1GB. Do the math, if one assumes that each image file is a measly 67k, and most ebooks have 1000 electronic pages, thats already 67megs. And I think I am being light on each image file.
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Well, if its a monochrome image, then it won't ever be more than 10kB, typically around ~4-6kB. I have actually had to deal with this while developing PDFRead, so I am pretty sure about the file sizes. Assuming 1000 pages (which seems a bit high, but whatever) the file size would be ~5-6MB. Pretty manageable, as cards of 1GB are very cheap nowadays.
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I just dont see what converting ebooks to raster gets you except bigger files, and less compatibility. DRM is the problem here, as well as expensive hardware. My answer get the eReader II down to $150, and more widescale adoption will occur. Much like mp3 players, until the price of the hardware came down, there is not alot of widescale adoption. Now everyone has an mp3 player.
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Well, there is a good enough reader in the eBookwise 1150 at $125, but no one buys it much. That's because it is way too costly. Read the article I mentioned above, most people don't read more than a few books a year -- buying something above the $100 psychological point is just not going to happen. Also, MP3 players had it much easier getting adoption -- you could easily rip a CD to get MP3s, you can't do that easily for books as OCR, proofreading, formatting, etc all are very labor intensive.
Also, this ebook would not targeted for heavy ebook readers who see the advantage of buying a Sony Reader or 1150 or whatever is current then. That is just preaching to the choir -- this for people who don't use them that often and don't see the value of going in for a high investment in something they don't use that often.
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Also what happens when I try to read the 800x600 ebook on my 640x480 device? It resizes the image down? Now the text is unreadable. What if I try to read it on my 1024x768 device? Now the text is blocky.
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Why would you have different screen sizes at the start anyway? In that unlikely case, it's upto the publisher to provide multi-format ebooks ie. support different screen sizes (or font sizes, or orientation, or whatever).