What does it do? The app is meant to allow desktop and tablet owners to read their Kindle books on those devices. I don't own a tablet, so I tried it out on a desktop PC with a Chrome browser.
It took only a minute or two to download and install the app (not unusual for a Chrome app). Once I had signed in to my Amazon account, I had almost immediate access to all the books in my Kindle Library.
The interface is clean and works well with the standard Chrome interface. On the front Library page, you can view a list of your books in either a list or grid view; you can order them by which you've recently read, by author or by title. A sliding control on the upper right lets you control the size of the images and type.
Most of the controls for both the Library and reading pages, however, are located on a dark banner that stretches across the top of the window. (Dark top banners seem to be in fashion these days; Google recently introduced one for its Google+ social network and other applications).
On the Library page, the icons allows you to manage your account (mostly, offering access to a help file and to various legal documents), sync your account and go to the Kindle Store to buy more books.
On the actually reading interface, the dark banner includes a button that takes you back to your library; a back button that returns you to your last location; and a button that will take you to various parts of the book, such as the cover, table of contents, or a specific location (using Amazon's rather impenetrable method of figuring location; for example, my copy of The Adventures of Sherlock Holmes asked me to enter a location from 1 to 4672).
You can also change various aspects of the page: font size, margins and color mode. An icon toggles a bookmark on and off for the page you're currently reading; another offers a list of your bookmarked pages, and the pages that you marked and/or highlighted in your Kindle.
You can page back and forth by either clicking on arrows on either side of the text, or using your PgUp/PgDn keys.
What's cool about it? An interesting feature, especially for tablet owners: You can download a number of your books to your local device. According to Amazon's Help page, you can store up to 50MB of books on an iPad (it doesn't specify how much space it designates on desktop PCs), which means that owners of Wi-Fi-only iPads will be able to read their Kindle books off-line. Any book you open will automatically be downloaded -- and could be removed from the local device when you hit the storage limits. However, the Cloud Reader gives you the ability to "pin" books you want to keep available off-line.
What needs to be improved? Well, to begin with, it needs to be more widely available. According to Amazon, the Kindle Cloud Reader will soon be offered for other venues, including Internet Explorer, Firefox, the BlackBerry PlayBook browser, and other mobile browsers.
Also, while you can view any text, markings or highlights you've added to your Kindle book, you can't actually add any using the Cloud Reader. Hopefully, that will be included in future additions.
Bottom line: The Kindle Cloud Reader is a fine, useful way to read your Amazon e-books on your tablet or desktop PC.
It will be interesting to see how users react to the Kindle Cloud Reader -- and perhaps more interesting to see how Apple reacts. Amazon has a large user base for its Kindle e-books, and giving iPad owners the ability to download and read those books is a direct challenge to Apple's iBooks app. Will Apply simple count on the quality of its iBooks app (and the selection from its iBookstore) to counter Amazon's services? Time will tell.