e-ink isn't (edit: good) color.

Tablets are the ideal form factor for things that would traditionally require a large, full-color book. That is: passing around a photo album, reading magazines, textbooks, comics, playing turn-based games like board-games and strategy games. If you use a stylus they're excellent for things that require free-form pen-and-paper like math homework and creating art.

Now, when they were a $600 luxury item that didn't really make sense as a product. But now that they're like $150 for a solidly good tablet they're absolutely a worthwhile purchase for those use-cases.