One of the hot topics at the Consumer Electronics Show (CES) this week in Las Vegas is color e-readers, with several companies showcasing new products. While E Ink has been a leader in e-reader display technology, the company has yet to produce a color display capable of showing video, and the next generation of devices could threaten E Ink’s dominance.

E Ink’s monochrome screens are made up of microcapsules full of positively charged white particles and negatively charged black particles. Applying a negative charge causes a pixel containing the particles to appear white, while a positive charge results in a black appearance. Color versions use the same basic technology, but with colored filters added. Unfortunately, these filters tend to reduce the brightness of the display, leading to a washed out appearance.

Companies such as Pixel Qi, Qualcomm MEMS Technologies, Liquavista, and Kent Displays all have new ideas about the best way to make a good color screen for an e-reader, and they are eager to get in the game.

This morning at the CES, Pixel Qi demonstrated its new display technology, targeted for use in netbooks, e-readers, and tablets. In high-power mode, the 10.1-inch display acts like a traditional LCD screen: a backlight provides light that is filtered by red, green, and blue sub-pixels to create desired colors. However, the display also has a low-power mode. In this mode the backlight is turned off, and reflective, mirror-like, elements–placed alongside the red, green, and, blue subpixels–take over the job of displaying the image, now in black and white. (How these elements are operated and distributed across the screen is being kept secret by Pixel Qi.)

Switching from the backlit mode, to the reflective one drops the display’s power consumption from 2.5 Watts to 0.5 Watts. This is for a refresh rate of 60 Hz–fast enough to display video. Pixel Qi claims that using software to put the display into an e-reader mode–suitable for reading text, where the screen might only update ten times a second–could drop the power consumption to as low as 100 milliwatts. The displays are currently in mass production and a number of device manufacturers are expected to announce products incorporating Pixel Qi’s display shortly.

“This is the year where you’re going to see some very interesting designs come to market,” says Jim Cathey, vice president of business development for Qualcomm MEMS Technologies. “I don’t think they’ll even be called e-readers in the near future.” With a myriad of features such as Web access, e-mail, and e-reader programs, these products will be known as smart devices, he says.

Qualcomm’s Mirasol screens can handle all of those applications and even display video. Much like E Ink screens, Marisol displays are reflective and require little to no power until the on-screen content needs to change. A little ambient light is also all that’s needed to see the screen. These displays are consequently ideal for a task such as reading, when the screen doesn’t have to change very often. But the Qualcomm device differs greatly when it comes to other applications, such as video or text messaging, that require frequent changes on screen. In those scenarios, Cathey says, Marisol’s displays perform much better than E Ink’s because they require less power per screen change. “As the content changes, the user experience changes and so do the requirements,” he says.