The web has been buzzing over the last several days over the possibility that Amazon might release a larger screen form factor Kindle device as early as this week. According to a New York Times article yesterday, people who have been “briefed on the online retailer’s plans” say that the company will introduce a larger version of the Kindle ideally suited for displaying newspapers, magazines, and even textbooks as early as this week.

The bigger question at hand of course is – will such a device save the newspaper industry which has seen subscription rates and advertising revenue plummet as more and more people go to the web for news and information? Will having a device such as this spur you on to subscribe to say, the New York Times – or will you simply use the larger display to more comfortably view e-books?

See – here’s the rub. If I can easily get all of my news content for free on the web – there’s very little incentive for me to subscribe to a news service on Amazon or through Amazon. There needs to be significant added value for me to consider that route.

There’s also another problem. The Kindle is already fairly expensive at $359. If Amazon does come out with a larger display – what would the price point? It can’t possibly be less than $399 – if only because it might cannibalize the Kindle 2 sales. Of course, Amazon could cripple the device in other ways but one would figure the larger display Kindle to be more expensive than the Kindle 2. Ok.. so if we go along those lines, we’re not entering the territory of small notebooks or netbook systems. Again – if I can get my newspaper or magazine content for free on a small notebook, then there’s no real advantage for me to go with the Kindle except for battery life and ease of use factor.

Yes, there’s also a coolness factor with the Kindle but in this day and age, coolness quickly gets overwhelmed by economic practicality.

The fact of the matter remains – newspapers are in trouble and need to adapt quickly. They need to either strip away all free content and force people to pay up for their services or they need to find some new means of revenue. It’s going to be incredibly hard to convince someone that they need to purchase a subscription for some content that they can readily get for free through some other medium.

Now with that said – I welcome a larger Kindle if only because I would love to read books in a larger display form factor.

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