“What is holding back electronic books?”
Me, for one. 
Perhaps in a generation or two, after most of the “oldschool” book readers have died off, this might become the predominant technology for reading. (but I suspect if that happens, the coveted luxury will become REAL books:)
In the meantime, too many of us who:
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get tired of reading/viewing over monitors and of the eye-strain involved.
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refuse to pay ridiculous prices (and even if/when these devices come down in price as they will, the price will still seem ridiculous to those used to hard copy) for something we simply don’t need. (of course, in a few decades, such devices will be considered absolute necessities which no-one can live without, like cell phones, lol)
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simply love the feel and smell and very nature of BOOKS, and will not accept any replacement. My 9 yr old daughter and I are currently reading the copy of Alice in Wonderland I’ve had since I was 6 (and read repeatedly)…the experience could not be matched in any other media…the smell of the old pages, the typos, the childhood scribbles immortalized in the pages, the feel of the worn cover and paper, the symbolism of that book.
I have a few thousand books at the moment, and while I am not a Luddite in most respects and readily accept new formats (dvds, cds, internet) there is nothing that can ever replace running my hand across the books in the shelf and choosing one, then pulling it out, opening it, feeling it, settling down to read it hold it in my hands and turn the pages. Nothing. There is no need to improve upon perfection.
One of my rituals is an annual reading of my collectors edition of Lord of the Rings…a BIG, heavy, very ornate volume. Yes, it weighs a ton, the pages are thin and fine and silky, the print is small. It is like drinking a fine wine.
Electronic delivery of literature is one option, but I don’t see it ever replacing books. Same way I can appreciate books on tape/cd and use them now and then, but would much prefer to read it for myself from a book.
One thing which will give it a boost is writers who opt to release their work ONLY in that form, or in internet downloads which are suited for that form of reading.
And perhaps it WILL someday replace actual books, but I don’t see that as progress.