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Apple controls 92% of the mobile app market, so the device will definitely try to leverage that. This means it will definitely be a multi-purpose device and you can probably load the e-reader software of your choice on it.
All this talk about video and books and music on the device, but not much about games. I think the device will be a gaming platform as much as anything. I've got a dozen games that I've loaded onto my iphone and my young nephews drop their DS and Wii whenever I'm around them and play the iphone.
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