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I applaud any company that once in a while allows a product to reach escape velocity and rid itself from the burdens of backwards compatibility. Not every step can be incremental.

And in this case it is not improbable that Amazon will make all books available in both new and old formats and that their readers will automatically download the right one so that the change does not encumber the end user the slightest but brings benefits on newer devices.

Are they still supporting their entire product line? Yes. Then who cares.
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