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You can also go into google books within the Sony e-store from within the Reader software and there are lots of free books there. I downloaded a free kobo book earlier this week that did have an epub format so I think it depends on the book. You are right though, a lot of them are not in epub format. I do use my kobo account quite a bit though if I want a newer book as it does have a good selection at a reasonable price.
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