With the year nearing a close, here are our top 5 predictions for the Kindle going into 2010.

5. Smart phone e-reader software becomes more popular
People often bemoan the death of reading without stopping to recognize the types of reading that people actually do engage in. In these modern times of ours, it’s far more likely that you’ll find somebody reading on a screen of some sort. And while e-Readers like the Kindle are perhaps too out there for many would-be readers, smart phones most certainly are not. The tiny screen of a phone will never do for more die-hard readers, but expect to see more and more people reading on their iPhone and Blackberries.

4. Publishers fight back
It’s been a story for much of the second half of this year: as reading on e-Readers becomes more popular, companies with a vested interest in print are pushing back. First Rupert Murdoch and some of the other newspapers started engaging in a tug of war, and more recently publishers have started banding together to delay the release of eBooks. This is just the tip of the iceberg. I fully expect content publishers to continue to come together to meet this threat – perhaps even resulting in the release of a new, pro-publisher e-Reader platform. One way or another, the landscape is going to change.

3. Low-cost e-Reader released
Speaking of landscape changes, one thing I’m certain we’re going to see in 2010 is downward pressure on the price of e-Readers. Studies have shown that the optimal price for an e-Reader is somewhere in the area of $100. It’s probably too soon to expect manufacturers to be able to get it down that far in just a year, but with new entrants like Plastic Logic being added to the marketplace, I think the trend is going to be towards more barebones products (without the built-in 3G, presumably) at lower prices, just to get people on-board.

2. A new contender emerges
While publishers and smaller manufacturers do pose a threat to the Kindle, they are minor fights compared to the threats of Barnes & Noble and Sony. I expect that one more major competitor has yet to enter the e-Reader fight next year. The good money at this point is on some sort of Apple tablet, but they have been dubious about being content providers in the area of books before, so the specifics remain to be seen. Don’t rule out Google as a possible competitor as well, though in what capacity and I hesitate even to speculate.

1. New generation of Kindle
One thing is extremely clear – Amazon simply can’t rest on their laurels. While initial reports seem to indicate that the Nook’s hardware is still a little rough, it’s only a matter of time before they get the kinks ironed out of their new e-Reader. That’s going to leave a competitor on the market that not only has all of the features people enjoy with the Kindle, but sports LCD touchscreen navigation for the same price. The way I see it, there are two paths that Amazon can go from here. They can either piggy-back on No. 3 and release a stripped down version of the Kindle for a fraction of the price, or they can go all out and release a feature-rich SKU with touch-screen navigation and color. I honestly wouldn’t be surprised if they did both. Because while they have the brand name and the market share right now, things are changing rapidly, and it’s going to be difficult for Amazon to stay on top of the pile.
One way or another, we’ll be there to cover it.