Pandigital, widely known for producing those nifty digital photo frames, announced this week that it will be releasing a $199 ebook reader that features a seven inch TFT LCD color touchscreen display.  Users will have access to the Barnes&Noble eBookstore as well as Panadigital’s own LendMe estore. The new Pandigital e-reader  looks very much like the iPad, which is a good thing and should help to push sale figures up.

The new reader called the Pandigital Novel (nice name) offers an 800×600 resolution screen, an SD/MMC memory slot for expansion, Wi-Fi connectivity and 1 GB of on-board memory. Due to ship out in June 2010, the Android-powered Novel can handle PDF, ePub and HTML file formats.  While it has no 3G it does sport an ARM 11 processor. The Android OS means that there will be many apps, which is exciting and something to look forward to! You can not only download ebooks on the Novel, but you can also watch video in living color and show off your favorite photographs.

Pandigital already has a whole slew of retailers so you will be able to pick up the Novel at neighborhood stores such as Macy’s, Kohls or Costco.  Pandigital says that a another Novel is on the horizon later this year which will be an 2GB model and that will have access to AT&T’s Edge network which reaches 97% of the United States.  There is also a 6 inch Novel ereader being developed now.

Who knows? With a reasonable price of $199 and a color screen, maybe the Novel is just what is needed right now to rival the pricey iPad and the leading black and white e-readers such as the Kindle and all those that copied it.