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E-Reader Price War: How Low Can It Go?

Barnes & Noble's Nook

Barnes & Noble (BKS - Get Report) unveiled its color version of the Nook as it tries to capture shoppers who are unsure about purchasing an Apple iPad.

The Nook Color, which features a seven-inch touchscreen, is retailing for $249, half the cost of an entry-level iPad. The new device can be used to view color content, including video files.

While Barnes & Noble's e-bookstore doesn't offer many books that have color content, it has built out a library of 12,000 children's chapter books, interactive color kids' picture books, and will also sell digital magazines and newspapers that have color graphics.

Nook Color also offers a some extras, with web surfing capabilities, access to e-mail, games and listening to music. But the device does not utilize e-ink and is significantly more limited in the number of apps it offers, compared with the iPad.

The device will begin shipping on Nov. 19.

This is Barnes & Noble's latest attempt to remain competitive in the e-reader space. Earlier in the year the book seller took to slashing prices on the devices, reducing the original Nook to $199 from $259, and introducing a Wi-fi only Nook for $149.

Aside from Barnes & Noble stores, shoppers are also able to purchase the Nook at Best Buy (BBY).

Barnes & Noble claims to own about 20% of the e-book market.

Forrester estimates that Barnes & Noble will sell 2 million Nook units by the end of the year.

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