I have spent the last few hours playing around with the beta version of the New York Times Reader software. In a word, revolutionary!
The Times and Microsoft (sorry Steve!) may have a winner here, as well as a glimpse into the future when we download our newspapers to a portable device and can read it WITHOUT squinting and going blind. This is designed to bring the print on paper experience into the 21st century, giving you something to hold and flip through off-line, with all the benefits of being online - search-able, tag-able, email-able, multimedia-able (so far just photo galleries).
It beats the dedicated readers that are giving it a go again because it is built to run of full versions of XP or Vista; utilizing all the horse power they provide. This may be what is needed to give the tablet PC format a shot in the arm and it may also be a glimpse into what newspapers are going to have to become in order to survive.