Amazon.com Inc is launching an improved Kindle electronic reader and cutting the price, in a move to address the threat from Apple Inc's iPad tablet computer.

Amazon's new Kindle DX will sell for $379, down from $489, and have free 3G wireless connection with no monthly bills or annual contracts, the company said.

Apple's iPad, launched in April, can also function as an e-reader. It sold more than 2 million units in its first 60 days and its own e-bookstore has quickly won market share, putting pressure on rival readers like Kindle and Barnes & Noble's Nook.

(Reporting by Sakthi Prasad in Bangalore; Editing by Dan Lalor)

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