Bookseller Barnes & Noble has finally unveiled its e-book reader, which many have already slated to be the Amazon Kindle's biggest competition yet. Called the nook, Barnes & Noble's $259 e-reader includes a full-color touch panel interface in addition to its 6" e-ink display, and is the first e-reader to run on Google's Android Operating system.

There is something instantly amazing about the nook, but it's not because of a single, readily visible feature. It's the fact that Barnes & Noble has combined the feel of two extremely popular devices both regarded as total "walled gardens" -- Apple's iPhone and Amazon's Kindle -- and effectively mashed them up in the open source Android framework. The result is a compelling new take on the e-book experience that has been more or less homogenous across the many devices currently available.

The 3.5" LCD touchscreen interface lets the user switch between periodicals, books, the Barnes & Noble download shop (which is accessible through AT&T 3G wireless), and system settings with simple clicks and swipes. When browsing through content in the bookstore or in the user's library, titles are displayed in a full-color coverflow interface.

Once a title is opened, the LCD menu at the bottom lets users search for in-text content, change font size, add annotations and highlights, and place bookmarks. To exit an open document, the user hits the "home" button very much like they would on an iPhone or iPod Touch.

Unlike Kindle, nook supports Wi-Fi and has a microSD expansion slot for additional storage. These features and the slightly smaller dimensions, however, make nook considerably thicker than the Kindle, at half-an-inch versus a third.

But the game changing aspect of nook isn't its Android foundation, its touchscreen interface or its backing from a major book retailer. It's the technology called LendMe, which lets users share books between nooks, iPhones, iPod Touches, BlackBerrys, and Windows/Mac PCs with Barnes & Noble's free eReader software. Books can be lent to other devices for as many as 14 days at a time.

The onset of nook may come as a shock not only to Amazon, but to at least one other e-reader manufacturer that had, as recently as four weeks ago, touted itself as the B&N e-reader. Irex's DR800SG has a stylish design, but it uses a stylus for its controls and lacks the touch-panel display that could, at least for the foreseeable future, associate the e-reader functionality of the nook with Barnes & Noble.

Pre-orders for Barnes & Noble's nook are currently under way.