The world of ebooks is about to start a new chapter with the arrival of the cheapest digital reader on the market. Asus, one of the world’s biggest consumer electronics businesses, confirmed last week that it is planning to shake up the market in the same way it did when it launched the first netbook — the low-cost alternative to the laptop.

Asus claims its ebook reader will be cleverer and more versatile than the current crop available from companies such as Sony and Amazon. It aims to unveil the device before the end of the year, according to Jerry Shen, the company’s president — and it may not be just one device, either.

The company is looking at a budget and a premium version, according to a spokesman for Asus in the UK. Details are scarce but the more expensive device is expected to follow closely a prototype dreamt up by the firm’s research and development team earlier this year.

Unlike current ebook readers, which take the form of a single flat screen, the Asus device has a hinged spine, like a printed book. This, in theory, enables its owner to read an ebook much like a normal book, using the touchscreen to “turn” the pages from one screen to the next. It also gives the user the option of seeing the text on one screen while browsing a web page on the other. One of the screens could also act as a virtual keypad for the device to be used like a laptop. Whereas current ebook readers have monochrome screens, the Asus would be full colour. The maker says it may also feature “speakers, a webcam and a mic for Skype”, allowing cheap phone calls over the internet.

Such features would move the device squarely into laptop territory. “Our ethos is innovation — as our brand is less well known, we have to run faster than the competition to develop new types of products,” said Asus. “Any such product — including an ereader — has to have the right combination of functionality and price. No one is going to buy one for £1,000.”

The budget version of the Asus ereader will be more in keeping with the Taiwanese company’s reputation for producing cut-price gadgets. Dubbed the Eee Reader, after Asus’s cheap-as-chips Eee PC netbook range, it is likely to take on the competition on price rather than features. The cheapest rival on the market is the Cool-er, which costs £189. Asus is thought to be aiming nearer the £100 mark.

Typically about the size of a standard paperback, ebook readers are able to store hundreds of digital books and convey the appearance of paper far better than a laptop screen does. The ability of some newer devices to access the internet and download digital versions of newspapers and magazines has widened their appeal beyond tech-savvy early adopters and towards the mainstream.

So far, the more sophisticated devices have taken some time to reach Britain. Amazon’s Kindle and the Sony Daily Edition, for example, both of which contain a 3G mobile-phone Sim card, are on sale in the US but not here. That is about to change. Irex is about to release a 3G ereader, currently known as the DR 800, in America. Both that and the Kindle are expected to go on sale in Britain in the next few months.

The arrival of a new rival from Asus could give the industry a much-needed shot in arm: to date fewer than 80,000 ereader devices have been sold in the UK, according to GfK, the retail analyst.

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