Plastic Logic on Wednesday announced it is canceling plans to release a QUE electronic reader aimed at giving business travelers a "paperless briefcase" amid stiff competition from Apple and Amazon.

The California-based firm proudly showed off the slim, flexible e-reader at a major Consumer Electronics Show (CES) in Las Vegas early this year but said the market has turned daunting.

"This was a hard decision, but is the best one for our company, our investors and our customers," said Plastic Logic chief executive Richard Archuleta.

"We recognize the market has dramatically changed, and with the product delays we have experienced, it no longer makes sense for us to move forward with our first generation electronic reading product." recently slashed the price of the Kindle e-reader in a bid to win the loyalty of "serious readers" that might be tempted to opt for Apple's multi-purpose iPad tablet computer.

Amazon, the pioneer of the e-book business, unveiled a 139-dollar wireless-only version of the basic Kindle, less than six weeks after dropping the price of the e-book reader to 189 dollars from 259 dollars.

Amazon founder and chief executive Jeff Bezos said sales growth for the Kindle "tripled" following the price cut to 189 dollars and the company is anticipating that the even-lower price will spur further sales.

Apple's cheapest iPad costs 499 dollars and features a color e-reader compared with the black-and-white Kindle, which is devoted exclusively to digital books.

US bookstore chain Barnes & Noble sells a version of its e-reader, the Nook, for 149 dollars while Sony's cheapest e-reader is 150 dollars.

Amazon does not release sales figures for the Kindle but says it has been the online retail giant's best-selling item for two years. Research firms and analysts estimate the number sold at more than three million units.

Apple sold nearly 3.3 million iPads in just the first three months since it hit store shelves in April.

Plastic Logic had billed QUE as an electronic document tool that went beyond what Kindles and other e-readers have to offer.

Archuleta had described it as "an electronic piece of paper" that would launch an age of "the paperless briefcase."

At CES, Plastic Logic introduced a proReader with four gigabytes of memory, capable of storing as many as 35,000 documents, with a price of 649 dollars. An eight gigabyte model was unveiled with a price of 799 dollars.

Both models could download reading content wirelessly at Internet "hot spots," while the higher end model also connected to the Internet using AT&T's mobile telephone network. Shipping of QUE devices was to being in April.

"We plan to take the necessary time needed to re-enter the market as we refocus, redesign and retool for our next generation ProReader product," Archuleta said.