Right now everyone is quietly anticipating Amazon releasing a frontlight-equipped Kindle, but it seems like they might be beaten to the punch by a small Chinese ereader maker. Onyx has just posted a video showing their latest prototype, and from what little I can make out in the darkened room it looks impressive.
They're calling it the Onyx Touch at the moment. They've taken their touchscreen equipped ereader, the Boox i62HD, and modified it so it has a frontlight. It's difficult to make out details in the video, but I did see enough in the first few seconds to confirm that the hardware matches the existing ereader. The i62 first showed up as a prototype last year, and Onyx has been selling it since early this spring.
This ereader looks to be heavily influenced by the Nook. The i62HD has a Pearl E-ink screen (1024x768), NeoNode zForce touchscreen, Wifi, and card slot. But instead of Android it's running Onyx's own custom Linux firmware which is based on the work they've done for their other ereaders. It actually has far more format support and much better annotation options, some of which you will see in the video.
I've heard from one of Onyx's dealers that his sample should arrive in late August and the device should be on the market in late September.
We might even see this device hit the market before a similarly equipped Kindle, but I wouldn't bet on it. Amazon can afford to throw a lot more resources at the problem.