The recently upgraded third generation Kindle readers is flying off Amazon's shelves at the moment. An upgrade – which incorporates a new 50% higher contrast e-ink technology display, smaller and lighter casing, faster page turns and a doubling of memory to 4GB – accompanied by a price reduction and the launch of a new Wi-Fi only entry level model, has seen demand for the Kindle reader take off.

At the moment, the third generation Kindles are sold out and potential customers face a wait of three to four weeks before any new ones start shipping. Kindle books are now selling more than conventional hard cover editions on a regular basis. It seems to be just a matter of time before e-book sales will higher than even paperback sales.

Amazon has also launched a dedicated UK Kindle store so that UK customers don’t need to have their Kindles shipped across the Atlantic and can pay for their Kindle purchases in sterling rather than dollars. It seems probable that further “local” Kindle stores will be opened for other Amazon international websites such as Germany, France etc. in the relatively near future.

In short, everything in the garden is pretty rosy for Amazon right now. Suggestions that the launch of the Apple iPad would spell the death of the Kindle seem to be, for the moment at least, unfounded. The Amazon policy of releasing free "apps" which allow Kindle books to be read on a wide variety of different devices seems to be paying dividends. So, bearing in mind the enormous success that they have achieved with their first manufactured product, it’s maybe no great surprise that Amazon is reported to be considering developing prototypes for consumer gadgets over and above the Kindle in their Lab 126 research facility.

Although Amazon has been tight-lipped on the subject, it’s thought that they may be thinking about music/movie players and possibly some kind of mobile phone. However, industry analysts suggest that, were Amazon to enter the market with another gadget, they would need to be sure that they were adding value rather than just releasing another piece of personal electronic tech onto the market.

Much of the success of the Kindle reader must be attributed to Amazon’s strong link with books and reading in general. The massive choice of Kindle books available – over 630,000 and increasing daily – and the fact that these can be read on so many other devices has been a real feather in Amazon’s cap. Any new gadget that Amazon decided to launch would probably need some similar type of support in order to achieve anything approaching the level of success enjoyed by the Kindle.