The new Amazon Kindle 2 digital book reader hasn’t been released yet, but it’s already becoming the gadget du jour, at least for the subway-riding New York digerati. The device, thinner than most magazines and capable of holding a shelf-buckling 1,500 titles, is poised to do for electronic books what the iPod has done for digital music.

But subway commuters aren’t the only ones getting excited by the Kindle’s upcoming release: the Author’s Guild, an advocacy group for writers, has posted an “alert” regarding the Kindle’s most notable new feature: a text-to-speech functionality that will read the book for you.  “”They don’t have the right to read a book out loud,” says Paul Aiken, the group’s executive director, in the Wall Street Journal. “That’s an audio right, which is derivative under copyright law.”

“Until this issue is worked out,” the Author’s Guild advises its members, “Amazon may be undermining your audio market as it exploits your e-books.”

It is unlikely that the speech feature violates copyright law, since no recording of the text is ever made.  But book publishers won’t have to prove their case in a court of law: if they are unhappy with the speech feature of the new Kindle, they can simply stop releasing content to Amazon.

Audiobooks exceeded $1 billion in sales in 2007 and are a major source of revenue for publishers.