Yes, they have created a competitor, but you can't just say "sans contract" with regards to the iPhone. The Kindle will always be a better product and bargain if for no other reason that it has built in broadband wireless service built into the $359 price. With an iPhone you would still end up spending almost $2,000. Now I do own a 32 Gig iPod Touch that 310-330 I would use this on and that iPod Touch which doesn't have Broadband Wireless, just crappy, useless Wi-Fi that only really works at my home. 310-345 I hope and wish that more companies follow Amazon's example and start including wireless broadband into their internet enabled devices and stop giving us Wi-Fi as the poor man's alternative. In case you didn't notice I HATE Wi-Fi, it's unreliable, when you can get it it's outrageously expensive - and even then it rarely works well. 310-502 I was at an airport just this weekend, it was $12 and slow as heck. I'm willing to pay a $200 premium for wireless broadband connection on an device like an iPod Touch. I will say that it makes me long for back light capabilities and color on the Kindle. The books look great on my Touch but the screen is way too small, I couldn't 310-560 imagine reading a full book like my Alexandre Dumas Kindle Collection or War and Peace on it.