Well, perhaps so. I certainly take your point that Kindle exists principally as a way for Amazon to sell their own books, and that this makes it less likely they'll excessively raise the price of it. On the other hand, if they have enough of a market hold that people will buy it anyway, because it's the product to have for the e-reading public, I also can't see them keeping the price low if they can get away with raising it.
I'm still bothered enough on principle by Amazon's attempt to tie the customer to their own store (even if there are ways around that, the point is there shouldn't need to be) to stop me getting a Kindle. But if they had support for ePUB, I'd be there (also if they started giving them away for free).
I guess the obvious comparison here would be Apple, with the dominance of their mp3 players and the proprietary format I think they originally used. What's your view on how similar/different the two situations are or might turn out to be? I don't really know enough about the tech business, the different markets and so on to be able to comment on that, really. Though it'll be fascinating to see how the digital book/e-reader market develops in comparison to what happened with the music industry and what they learn (or don't learn) from the latter.
Oh, right, you actually asked me a question. Sorry about that.
Well, I did give it some thought, actually, and the conclusion is I'm not really sure. As some posters have pointed out, Amazon isn't exactly trying to limit it's customers from reading their books; I have a Kindle software installed on every device from my laptop to my toaster. And converting books isn't that hard, either.
But there's no denying that open standards are best for the consumers, and nowadays consumers are good at getting what they want. There is heavy pressure on Amazon to at least include support for ePub. I expect they will, soon enough, but for now, I don't really think the Amazon format is going to go anywhere.
One thing about e-readers that's different from mp3 players, however, is the length of their reign. E-ink is cool, but sooner or later someone is going to make a tablet that doesn't glare in sunlight, and that's going to give Kindle a big blow. Once someone makes a battery strong enough to keep such a tablet going for a week, e-ink will fall into oblivion as surely as cassette tapes did.
But of course there is the chance of Amazon introducing it's new color-touchscreen Kindle by then, and they are not likely to lose their hold of the book market, even if their devices can't keep at the top.
But, to finish off this rather poorly constructed rant, I believe the Kindle will begin supporting epub formats soon enough, but will likely keep selling Amazon format books, at least until there are some serious changes in the structure of the publishing house business. And that change isn't going to happen fast.