There is no market for a $650 e-reader.

That was the inevitable conclusion reached by chip-maker Plastic Logic, which announced this week that its Que e-reader will never see the light of day.

The device, which has been widely admired, was in development for years, and was well received when the company showed it off at the Consumer Electronics Show this January. The 8.5 x 11 inch device was scheduled to ship in April but was delayed until later in the year. Plastic Logic stopped taking orders in June, and now it has officially killed the Que.

"We recognize the market has dramatically changed, and with the product delays we have experienced, it no longer makes sense for us to move forward with our first-generation electronic reading product," said CEO Richard Archuleta. "This was a hard decision, but is the best one for our company, our investors and our customers."

The super-thin reader -- it's 1/3 inch thick - was targeted at business users, and Plastic Logic tried to distinguish its product from readers like Amazon's Kindle by branding it a "pro-reader." The idea, said the company, was to replace a business traveler's briefcase with a Que, which would have allowed users to access and edit Microsoft Office files and PDFs. It also had content partnerships in place with the Wall Street Journal and Financial Times, among others.

But $650 for a 4GB e-reader, or $800 for an 8GB version, seemed steep when the device was unveiled, and following the recent e-reader price cuts the prospects looked dim. Once more than $350, a Wi-Fi-only Kindle can be had for $139. You can pick up a 3G-enabled Barnes & Noble's Nook for $199 ($149 for Wi-Fi only), and the Sony Reader is similarly priced.

The iPad's runaway success, though, was probably the nail in the coffin. If you can get a fully functional tablet computer for $499, paying $150 more for a device with much more limited functionality, no matter how nicely designed it is, isn't much of an option.

But Plastic Logic says it doesn't plan to throw in the towel just yet, though Archuleta's promise is a bit vague: "We plan to take the necessary time needed to reenter the market as we refocus, redesign and retool for our next generation pro-reader product. We continue to perfect our core plastic electronic technology and manufacturing processes that are central to our product's unique value proposition."

Plastic Logic is owned by a group of venture capital firms. On Sunday, the Financial Times reported that Rusnano, a state-owned Russian nanotechnology company, is in talks to take a controlling interest in Plastic Logic.