The Kindle is nice and all, but it's a lot of money for a dedicated device for reading books when I already have tons of devices capable of reading books. A screen, a wireless connection and a keyboard. That describes a Kindle. That also describes laptops, cellphones, iPhones, PDAs, etc.
If you want to sell lots more ebooks, I suggest you release Kindle software for some or all of those devices. Specifically I would suggest laptops and iPhones. The iPhone is my preferred way to read Kindle books (it is way smaller and lighter than Kindle, and I already have it with me all the time), but it'd be really swell if I could wirelessly purchase the books from you and not have to break the law in order to read them.
Now that Apple has 3rd-party apps for iPhone/iPod Touch, I HIGHLY recommend that you make a Kindle app for them. You'll sell bajillions more books than you already do. BAJILLIONS.
I think that it's great that you're getting into both the hardware and eBook business, but do you really think it's such a good idea to hinge the success of both on each other? I mean, I have so many devices now that are capable of A) browsing the net, and B) reading eBooks that it would never even cross my mind to pay you $400 American to get another one so that I could purchase books electronically from you. (OK, so it crossed my mind, but I immediately said "no.") I'd love to be able to purchase your eBooks and read them on any number of my devices, but you make that impossible without buying a Kindle.
You keep making a big deal about how "Kindle is not a device, it's a SERVICE," which is a great way to look at it -- except for one little detail: you have to buy the device to access the service, so it's not really fair to say that. Please consider allowing people to download the Kindle files from amazon.com themselves, rather than requiring that they get sent over the EV-DO network to the Kindle that they probably don't even own.
How about an application people could install on their laptops to access the Kindle network from there? Or better yet: how about a web 2.0 version of Kindle, allowing people to log in and read their books from any browser-enabled computer?