1) The device is expensive. $400, without touchscreen, or backlight.
2) The users will have to pay for blog access. The books, newspapers, and blogs can be downloaded over-the-air via cellphone network without any monthly charge. However, only a limited number of blogs is available and the monthly fee to access blog, though minimal, is not zero.
3) Funky Keyboard and colorless screen. Imaging reading Stephen Colbert's I'm America without color. Also, the keyboard makes the screen unnecessarily smaller and ugly.
Here's how I think it should work:
1) The device should be much much cheaper, say $100 to create externalities. Amazon is going to harness the profits from the magazine/newspaper subscription and high-margin electronic books anyway (currently charged at reasonable $10).
2) It should come with color touchscreen and without a keyboard.
3) Flat-fee monthly subscription can be charged minimally to cover cell network costs incurring to Amazon. With this, it should allow free access to any blog.
This is going to be like other e-book readers that came out and flopped. They can come up with future slicker device but that's not going to take off until they're reducing the price and willing to take some loss on device cost. $10 is the price point that people are happy to pay.
Don't be afraid of pirated ebook distributed on BitTorrent or something. Think about how Apple is making tons of money out of their DRM iTunes songs...
