Amazon.com acquires e-book software maker Lexcycle

Lexcycle, best known for its successful, top-selling iPhone app Stanza, has been acquired by online book seller Amazon. Though the two companies make competing e-book reading software for the iPhone, for now, Lexcycle will operate as an independent subsidiary.

The company, in addition to its iPhone app, makes a desktop version of Stanza for Mac OS X and Windows. Stanza Desktop can sync e-books wirelessly with the iPhone version, and both support a number of formats, including TXT, RTF, PDF, and DOC, as well as DRM-free versions of Kindle, Mobipocket, and PalmDoc. The iPhone version can also read Fictionwise's eReader format, with or without DRM, as well as the open ePub format.

Despite the competition that Fictionwise's content has with the Kindle's e-books, as well as the competing iPhone e-book reader applications, Amazon insists that it won't kill off Stanza nor will it necessarily combine the capabilities of both iPhone apps. "As a standalone business unit within Amazon, Lexcycle will maintain its business model while continuing to innovate as new opportunities arise," Amazon spokesperson Cinthia Portugal told Ars via e-mail. "The goal is for the combination of the two company's strengths to offer great experiences for ebook readers."

However, Stanza users aren't optimistic that Amazon will let things be. Mobipocket, which offers e-books for a number of mobile devices, was also acquired by Amazon. So far, the company has been unable to release an iPhone version, and at least one person has alleged that Amazon blocked Mobipocket from releasing an iPhone app. Further, the acquisition puts a large chunk of the e-book reader market under Amazon's control.

The best case scenario, however, is that Amazon will combine the best of both worlds. If a single iPhone app could read all the formats of Stanza (along with encrypted Kindle format) and have better control over text formatting, the move could prove popular. Further, Amazon could adopt Stanza desktop as a companion to Kindle as well. For now, e-books seem to be the future of reading, and Amazon is putting itself in a position to be in control of that market.