The future of reading relies on e-book reader devices, and while some may still be reluctant to leaving the classic paper aside for an electronic device, others have embraced the technology. It’s all about the so-called electronic paper now, and Amazon’s Kindle, with its ups and downs, its pros and cons, continues to build momentum, whether alone or in direct confrontation with a rival.

Last week, not long after Sony introduced its latest addition to the Reader Digital Book Family, the PRS-700, photos of Amazon’s next-generation Kindle leaked on the Internet. This follows months of speculations that Amazon was working on an upgraded Kindle in the making (which they’ve been very discrete about).

If we go back in time, when Amazon first launched Kindle, the reactions were mixed, and here’s why: it seemed like a very practical device, with extended functionality compared to other electronic books, with wireless connectivity and access to tens of thousands of books. The problem was, however, the price tag, which was more than most people were willing to pay. Despite that, just a couple of days after Amazon made its e-book reader available for sale, Kindle readers were already sold out.

But as a new generation of Kindle readers is about to come out (although Amazon gave no confirmation of that), the competition just got tougher, with Sony introducing the PRS-700, with the dimensions of a slimmed down paperback book, a stylish design, perfect for consumers who are often on the go. But best of all, Sony introduced touch-screen capabilities to its six-inch display, which is something Amazon’s Kindle 2 still doesn’t have.

On the other hand, Amazon keeps its QWERTY keyboard, and somewhat of a rough style in design for Kindle 2, but it brings the same functionality we have been accustomed to. The new Kindle also comes with some changes, in the sense that the scroll wheel has been replaced by a joystick, and the buttons have been redesigned.

Kindle 2 may not be as beautiful, but it is just as functional as Sony’s touch-screen PRS-700, and it has something Sony’s reader doesn’t have: WiFi capabilities. This has always been a key element in Kindle’s success; furthermore, Amazon’s vast library that Kindle has access to adds up to Kindle 2’s charm. However, we must keep in mind that Kindle 2 has not been officially introduced, and there may be more to it than meets the eye.

While Sony keeps up with the latest tendency in customer demand in terms of design, Kindle continues to remain a strong competitor. However, how will Kindle 2 compete, if Amazon is not ready to unveil it yet? Sony has already announced the availability of the PRS-700 models next month, for a price of $400. This is slightly above Kindle’s current price, but it’s still hard to make a comparison with Kindle 2 in terms of pricing.