New Kindle e-book reader coming from Amazon. Old model is still out of stock.

Amazon.com is expected to announce a new version of its Kindle e-book reader today. And in a sign that the electronic book is gaining clout in the publishing world, Amazon is also expected to say it has acquired a new work by best-selling novelist Stephen King that will be available exclusively, at least for a time, on Kindle.

Many publishers have long feared that Amazon would persuade a major author to write for its Kindle on an exclusive basis. Although retailers such as Barnes & Noble have long published their own books, they have struggled to find distribution outside their own stores. But Amazon has already proven that it can sell as many Kindles as it can manufacture. Indeed, Amazon is working to overcome the supply problems that have plagued the device and the Amazon website shows that the Kindle is "sold out," and it has been since November and missed holiday sales.

It is possible that the King work -- in which a Kindle-like device plays a role in the story -- could be published as part of a physical book at a later date by the author's current publisher, Scribner.

The maker of the Kindle's special screens, Taiwanese manufacturer Prime View International, says the Kindle shortages came from Amazon's conservative sales forecast for the device. Prime View adds that Amazon is now trying to avoid repeating the current shortage by asking it to pump out more screens.

"It wasn't about delivery delay," says a Prime View spokeswoman. "The sales were just faster than expected," The company says the new version of the Kindle is set to have a slightly bigger screen than the first-generation model.

"Amazon might be managing the Kindle availability as it wants to keep the buzz on its product and improve features and performance with the launch of the second generation product," says Vinita Jakhanwal, an analyst for iSuppli Corp. From a screen-manufacturing perspective, she adds, "there doesn't seem to be any specific reason why Amazon was unable to meet the demand with its first generation product."

How well Amazon can supply the Kindle -- its first foray into the consumer-electronics industry -- is important because the device is expected to be a growth business for the company's drive into digital sales.

Amazon won't disclose details about the new Kindle, but said last week that it is working to make titles for the device available on cellphones. That puts the company more squarely in competition with Google's digital-books distribution platform.

To create the Kindle, Amazon tapped a deep bench of consumer-electronics experts. The product was designed by a subsidiary called Lab 126, located a few blocks away from the Apple headquarters. Lab 126 employs executives who used to work in the consumer electronics industry.

Analysts who have examined the device also say Amazon turned to Apple's giant contract manufacturer Hon Hai Precision Industry, among others, to assemble the device in China.

One factor that may have contributed to Amazon's supply problem was an Oct. 24 endorsement by Oprah Winfrey, who called her Kindle "my new favorite thing in the world." Ms. Winfrey's production company, Harpo Inc., says she wasn't paid for that endorsement, and chose to promote the Kindle on her own after being shown one by a friend. (info from The Wall Street Journal)