Google wants to sell e-books and is working to sign up authors and create a framework for the deal, which would obviously compete with Amazon’s Kindle. We think the two companies have seen each other increasingly as competitors, and for good reason.
Amazon is kind of a “instant-gratification” search option; look up what you want and buy it. The two both provide cloud services, and now Google wants to be an e-book alternative. The threat to Amazon here is real because if Google can make a generic e-book system work, it would have profound impact on the Kindle market. Others have tried to create such a system, however, and it needs a purpose-built appliance to prevent copying. Will Google propose this as a part of Android? It will be interesting to see.