I’ve been a big fan of the Amazon Kindle since its initial release, and I’ve faithfully upgraded with every new generation. The Kindle 2 was a huge improvement over the first model, and the newest third generation Kindle appears to be a worthy and worthwhile successor, as well.

The biggest differences between the Kindle 2 and the Kindle 3 are:

The very compact Kindle 3 on top of the larger Kindle 2.

• Better screen. Amazon claims that the Kindle 3 has 50% better contrast than any other e-reader. I’m not exactly sure how contrast is quantified, but I can say that the Kindle 3’s screen is much better than the Kindle 2’s. In fact, the first thing I noticed about the Kindle 3 after unpacking it was how much whiter the background looked.
• Smaller form factor. The Kindle 3 is 21% smaller than the Kindle 2 and 17% lighter. In terms of dimensions, that’s about half an inch smaller in both width and height. Note that the 6″ screen remains the same size.
• Wi-Fi version. Amazon is now selling a Wi-Fi version for $139 and a 3G version for $189. I decided to go with the Wi-Fi version and save the $50.
• Better battery. I haven’t really been able to test the battery thoroughly yet, but Amazon claims that the Kindle 3’s battery will last up to a month (with wireless turned off). Based on the battery performance of my other Kindles, I would say that’s probably accurate.
• More storage. My Mac reports the size of the Kindle 2 as 1.59GB, and the size of the Kindle 3 as 3.33GB. Amazon says that’s enough to store 3,500 books.
• Faster page turns. Amazon says the page turns on the Kindle 3 are 20% faster. Honestly, that seems low to me. I would say the Kindle 3 is at least 50% faster if not even more, but I’m not doing actual benchmarks. Let’s just say that the Kindle 3 is noticeably and significantly faster.
• Better fonts. The fonts on the Kindle 3 appear thicker and darker.
• No joystick. The Kindle 3 replaces the navigation joystick of the Kindle 2 with a D-pad. So far, I think I prefer the new D-pad.
• Rubberized backing. The Kindle 2 has a brushed metal backing and the Kindle 3 has a nice soft rubberized coating on the back.
• Better PDF reader. The new PDF reader on the Kindle 3 supports looking up words in the dictionary, notes, and highlighting. I don’t find the Kindle particularly useful for PDF viewing because PDF text gets scaled rather than reflowing, but if PDF viewing is important to you, the Kindle 3’s improvements will probably be a welcomed upgrade.
• WebKit-based browser. WebKit is the standard for mobile browsers now, and Amazon has built it into the the Kindle 3. I don’t consider this a very important feature, however; frankly, I think you’d be crazy to browse the web on any Kindle. The Kindle 3’s browser works much better than previous Kindle’s, but if you have a computer, smart phone, or tablet anywhere nearby, you’re always going to reach for it over your Kindle when you need to look something up on the web. That said, in a pinch — when you’re out at the pool and your phone and your iPad are both up in the room — it’s serviceable.
• New color. I bought the graphite version which is the only Wi-Fi option available, but the 3G version comes in graphite or white.

The three features that mean the most to me are the higher contrast screen, smaller size, and faster page turns. These are the things that you will notice right away, and that you will appreciate throughout the entire life of the product. The new lower prices are nice, as well. The cheaper the Kindle gets, the more places and situations you’re willing to expose it to, and hence, the more useful it becomes. I still don’t think we’ve hit that magical price point where purchasing a Kindle and keeping it with you at all times is a no-brainer, but we’re definitely one step closer.