So not a breakthrough by amazon ;-)
Funny, spec wise this is identical to my cheapo $49 iRiver HD which I've had for a year. Some other readers have it too.
With a book or slow ereader, page turns interrupt your reading, but on a phone they're instantaneous so pretty much disappear as a reason to prefer large pages.
When reading, your eyes focus on an area about 3 lines high and about 5-10 words across. Unless you're a beginner reader you don't read one word at a time. Because the width of a smartphone is the same as the width of what you're focusing on, the lines above and below your current reading line provide full context for your brain to help interpret the current line, improving reading speed and comprehension.
Also there is no eye scanning or head movement required, which I really appreciate when reading in bed.