I still have one bugbear with electronic books
namely that I can't simply take my favourite books from the shelf, stick them into a device attached to my computer and then transfer them to the reading device. Am I going to pay again to get those books in a different format? Not unless it's very cheap, I'm not.
However, there's plenty of room for this market to get pretty exciting. Digital editions included with old'n'busted paper editions, direct selling by authors to their audience (iTunes Bookstore, anyone?) and simultaneous digital and paper publication, all the lessons learned by the music and video markets can be transferred directly, minus the birth pains.
Yes, people will still complain that there's nothing like a good old-fashioned book in your hands, but much the same was said of audio cassette and home video as they supplanted their forefathers.