I already own a Kindle and a Nook and have to say that I barely use either of them. The reason I bought them to begin with is because I'm an early adopter and had to have them. Shortly after purchasing them, I also downloaded their iPhone App counterparts, and for the most part, haven't looked back. To make matters worse, on April 3rd, my iPad will arrive, and then I really won't have a need for them.
With the above in mind I thought I would have zero interest in Kobo's eReader or service. Surprisingly, I was wrong. So, what makes the Kobo eReader compelling with the Kindle, Nook and soon-to-be iPad already saturating the market? For me it's all about the price point for utility. As the chart below shows, the Kobo eReader doesn't offer up internet connectivity and some other features, but what it lacks, it makes up for in price and look and feel. For example, for $149, you get a standalone e-ink reader that can grab its content via Bluetooth or USB. No integrated Wi-Fi or 3G, but it comes with 100 free eBooks to get you started, and can easily grab new content from its own book store. It's also lighter than the Nook and the Kindle and looks to have a more comfortable surface to hold on to.
I think if I didn't have the Nook, Kindle and an iPad on its way, this would be a no-brainer purchase for me. There's no contract, it's affordable, and there are compatible readers for the Kobobooks service on a number of platforms already. I think that this will be a serious competitor in the market, especially once it starts shipping at Borders this summer.
UPDATE: Kinley from Amazon reached out to me to correct some of the stats in the chart above. According to Amazon, the Kindle is .36" thick, not .75" and supports the following file formats: AZW, PDF, TXT, Audible (Audible Enhanced (AA, AAX)), MP3, unprotected MOBI, PRC natively; HTML, DOC, JPEG, GIF, PNG, and BMP. I pulled that chart from Kobo and will now make an attempt to inform them, too.