In technology bigger is not meant to be better. Smaller, faster, cheaper are the bywords of progress for most gadgets. But Amazon is hoping to swim against the tide with its new Kindle e-book reader, the Kindle DX.

The DX, with its 9.7inch display that is more than twice the size of the Kindle 2, was unveiled this week with some fanfare. As well as its bigger screen it also has a bigger price tag – $489 (£325) compared with $359 for the Kindle 2.

What the bigger display delivers is the ability to read digital newspapers, documents and textbooks. In addition to displaying larger formats such as newspapers, it has a screen that renders images and text in 16 shades of grey and black, in a device that holds 3,500 books or periodicals.

Amazon has proved that there is a market for e-book readers with the Kindle and analysts estimate that the company sold more than half a million of them in the US, its only market, last year.

Jeff Bezos, the chief executive, is hoping for more of same with the DX, despite the high price.

It is a hope that is shared by many newspaper executives, desperate for the big idea that will help to save their businesses. The New York Times, The Boston Globe and The Washington Post plan pilot programmes in which they will offer the new Kindle at a discount to some readers who sign up for subscriptions to read the news on the device, in the same way mobile phone providers subsidise phones. “Ultimately, this is about providing our readers with what they want and need,” Arthur Sulzberger, the chairman of The New York Times, said at the launch.

Details of the Kindle DX deal with newspapers are still to be announced but the launch is likely to be the first of many as other newspaper groups clamber on board the digital reader train.

Pearson’s Financial Times and Gannet’s USA Today are among newspapers to have signed up with Plastic Logic, which is working on a reading tablet that can display books, periodicals and work documents. The device should be ready by early next year. Crucially it will allow publishers to display ads, increasing the revenue possibilities.

The belief is that mobile devices – phones or e-readers – may provide a way to get customers to pay for electronic content, with executives of the Financial Timesdescribing it as having the potential to revolutionise the way newspapers are read.

However, it is not a view that is shared universally. Rupert Murdoch, the chairman and chief executive of News Corporation, parent company of The Times, is wary, amid concerns that digitisation could leave publishers facing the same problems seen in the music business. “I can assure you that we will not be ceding our content rights to the fine people who created the Kindle,” Mr Murdoch said on Wednesday, arguing that it was critical that News Corp “control the prices for our content”.

At a Senate hearing on the future of journalism on Wednesday James Moroney, the chief executive of the Dallas Morning News, complained that Amazon wanted 70 per cent of any subscription revenues that his paper earned through the Kindle and the right to republish the newspaper’s stories on other portable devices.

But if the Kindle’s anointed role as saviour of the newspaper industry is in some doubt, its prospects in the textbook market, worth an estimated $8.6 billion in the US, seem clearer.

Three textbook publishers – Pearson, Cengage Learning and John Wiley & Sons, which between them publish 60 per cent of all higher-education textbooks – have agreed to sell books on the device.

That might assure the future commercial success of the Kindle DX, although it is rather less clear that newspapers – still working out how to charge for content – will be able to succeed similarly.

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