said its best-selling Kindle device was currently out of stock, leading one Internet analyst to surmise the online retailer was poised to launch a new version. On its website on Wednesday, the world's largest Web retailer posted a “temporarily out of stock” notice next to its $189 Kindle, the much talked-about e-reader that Amazon says is the best selling item on its site. Cowen & Co analyst Jim Friedland, who published a note to clients titled “Is the Kindle 3 Launching Shortly?,” said a host of clues, especially the out of stock notice, pointed to a third generation Kindle. “The only time we've seen that type of messaging is right before they've launched an updated Kindle,” Friedland told Reuters. “There are too many reasons to suspect that a Kindle 3 is coming.”

Other clues, he said, include the availability of faster and cheaper chips to improve the Kindle's response time, and blog commentary that Amazon was cooling down orders for the screens it currently uses on the device. Amazon did not immediately return a call seeking comment. Friedland predicted there was only a 20 percent chance that the supply issue was caused by extra demand for the Kindle due to its recent price cut to $189 from $259. Friedland said he did not expect the $189 price tag to change, nor that any new version would be “revolutionary.” “They'll continue to make it into a better version of what it already is,” Friedland said, noting that a lighter, more durable yet bendable screen, and eventually color, are both on the horizon. “Our theme is that the Kindle device is going to get cheaper, lighter, faster,” said Friedland, who rates Amazon shares “outperform.”

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