I bought a Kindle 2.0 because I wanted to buy a Kindle in October 2008, but decided that there were enough limitations (e.g., no fixed-width fonts, a killer for someone who codes, and form-factor issues) that I’d wait. But I was already sold. When the 2.0 pre-orders came out, I was all over it late that first day, and received mine at the end of February.

The first night, I downloaded a ton of free content. If you’re interested, there’s a whole slew of public domain books available that range from classics from Tolstoy, Dostoyevsky and Joseph Conrad, to the first book I read, “The Art of Money-Getting” by P.T. Barnum.

The Kindle changed the way I read.

Here are the surprises, the things that I didn’t really understand about the Kindle but that pleased me.

One-Click Buying

Amazon is reviled for its patent on one-click ordering, but the Kindle shows this power. I sat at my computer in the most frictionless environment possible, viewing free public domain books, and going through about 1000 in 30 minutes, picking around 20 which, with a single click each, I could have wirelessly delivered to my Kindle. Abstractly, I understood this. But I didn’t really get it until I suddenly had a huge amount of content freely available downloaded to the Kindle within seconds of being purchased on the computer.

I’ve long said that the genius of Amazon as a company is the mastery of distribution. If you don’t understand this, you don’t understand Amazon. It is the primary reason for the insane multiple. They will be bigger than Wal-Mart, and they will get a target on their back the size of Texas. They’re like Microsoft in 1994—set to explode, but with many formative decisions still in front of them. I only wish I could get Amazon Affiliate bucks on readers buying the stock, because that’s the real story here. But I tell you what: take the spare cash you have, that money you’ve been waiting to invest, and split it into two piles. One pile is a small one. $369 for the Kindle. The other pile is whatever your average position size is. Two-percent, five-percent, whatever. Split that in half, and put half in AMZN stock, and put the other half in about 6 months from now or if it dips into the 40s on market weakness (unlikely, given its recent strength). You’ll pay for this Kindle and the next version and the version after that and all the content you’ll buy for the next 5 years many times over.

One-Click Reading

Okay, but what about the device itself? The first Kindle had the aesthetics of a Russian space capsule console. Thick, non-Apple-like, bulky. The Kindle 2.0 is sleek. The buttons are clicky, solid-yet-tinny, but get the job done. You can read a freaking book with your thumb! I can’t overstate this power. Sure, no good for the bathtub, but who was time to read in the tub anymore? This is reading for the laziest of the lazy. You could be one of those 1017-pound dudes on the Discovery Channel who has to be chain-sawed out of his house and this could still change your life.

I’m a chronic no-bookmarker. The saving of context saves me the hassle of finding my place, or dog-earing, or sticking whatever scrap of paper that’s available in a book and having one of my kids yank it out anyway.

It’s Not All Good

Okay, now for the downsides.

Rendering of content that was designed for a fixed-width font or had long lines is problematic. If you’re a coder, this is an issue. But I’m a glass half-full kind of guy when it comes to Amazon, so I foresee a killer “programmer’s Kindle” eventually emerging on which you can have all essential programming documentation at your fingertips and easily accessible. It seems like such a natural evolution that I think the wise move is just to get the Kindle now, buy some stock, and use the winning proceeds in a couple of years to pay for the upgraded device. Reorientation of the display to landscape might help, but then the buttons would be in the wrong place.

The jog-stick sort of sucks. This could be smoother and faster, but it’s not critical. It’s your thumb that gets the workout. This is by and large a passive device, so optimizing for the core function—reading—is the right design decision now.

But It Still Kicks Butt

Joshua Schacter says that focused narrow experiences—basically, doing one thing and doing it well—is the hallmark of Web 2.0. Kindle is the first Web 2.0 device. It nails the e-reading niche and experience. It’s disrupting the publishing industry already.

The Future: Long AMZN

When I hand the Kindle to curious by-standers, the first thing that all of them do is try to navigate by touching the screen. So you see where this is going. A lot of people look at the release of an iPhone/iPod Touch Kindle reader as a repudiation of the device itself, but remember…if Apple comes out with a tablet, the thing’s going to not have the same dynamics as the Kindle. Why? First, the screen technology will be different. The e-ink of the Kindle allows for a lower-power smaller profile. Second, the Kindle OS must be incredibly simple; even the Mac OS draws a lot, and Microsoft? Please. But I get the sense that adding touch to the Kindle is several orders of magnitude easier to accomplish than it would be to slim down any of the tablet operating system candidates out there today (much less create one from scratch.) This combination of first-mover advantage, plus association with a distribution channel, plus being on the right side of the technology stack. Amazon just wins, plain and simple.

So I’ve either convinced you to buy a Kindle, or to invest in Amazon. Not sure which. But if you’re here because you’re more interested in the stock than in the device, let me offer some caveats. First, Amazon has been incredibly strong during the recent downturn in the market. While the overall market has been down 20% in 20 days or so, AMZN has been up. You could have bought it for as low as $48 during the last 90 days, and as low as $34 in the last four months. If, as I believe, all good companies must be made to suffer, particularly retail stocks, before this depression can end, you may have several opportunities to average down. I got in at $60, but that might end up being a trade rather than a 2-5 year investment. I would be backing up the truck if Amazon starts painting numbers in the 40s or 30s again, even if their revenue starts getting hurt. They will crush brick and mortar because they are not about selling things, they are about DISTRIBUTING things. That’s their DNA. If you don’t understand that, you don’t get them.

So that’s my rant. Buy a Kindle 2.0 for the Amazon love. And buy the stock. Your kids will thank you.

Several times over the last seven years, I’ve purchased an AAPL product instead of buying the stock. Without fail, I would have been better off financially buying the stock rather than the device.

Tonight, I pre-ordered a Kindle 2.0 and the same effect may be at play, despite Amazon’s big run up since its lows.

The new Kindles aren’t available until the 24th, so that gives me a few more days to try to get back into my AMZN position that was called away at 50. The more I study Amazon, the more amazed I am at their strategy and coherency of vision.