Is Amazon the Bigger Threat to Google?

You can almost hear Mel Gibson's dramatic cry for freedom at the end of Braveheart in listening to Google's (Nasdaq: GOOG  ) pitch for its new eBookstore, which officially launched this morning after a year's worth of buildup.

"Today, there are all kinds of e-book standards, each with their own dedicated e-reader and their own specific place to buy books, and all lacking one thing: choice," says the narrator in this YouTube pitch for the new store.

Freedom is the watchword for Google e-books, in other words.

I'll understand if this sounds like spin. On one level, it is. The difference is that Google has created software to allow virtually any device to consume e-books from its store. A support site includes application downloads for Apple's (Nasdaq: AAPL  ) iOS devices, Android smartphones, and a wide range of e-readers that support Adobe's (Nasdaq: ADBE  ) eBook platform.

Compatibility is the allure of the eBookstore for readers. For investors, choice is more of a blunt instrument. It ensures that neither Apple nor Amazon.com (Nasdaq: AMZN  ) so control e-book distribution that they freeze Google out of a massive advertising opportunity. (Our reading habits say a lot about what else we might be interested in.)

But Google's real stroke of genius was teaming with Adobe, the company most closely linked with the business of digital publishing. Backing its e-book standard in reader software means gaining dozens of devices, including second-tier readers put out by Sony and Barnes & Noble, while also stiff-arming Amazon and the Kindle.

Only titles lacking digital rights management -- i.e., old editions -- are compatible with the Kindle, press reports say. Google's own pages say simply: "Google eBooks are not currently compatible with the Kindle." Terrific.

Google has good reason to want the Kindle dead. First, it's the leading e-bookstore, and given the success of Google News, it's a good bet that Google would rather lead this market than let someone else feed it scraps.

Second, Android tablets are coming. There's no way to kill the iPad, but crippling the Kindle would make it easier for Google to create the sort of two-horse race in tablets that already exists in smartphones. Android vs. iOS, everywhere; books are just the next battleground.

Think I'm wrong? Is Amazon.com's threat to Google's eBookstore overrated? Please vote in the poll below and then leave a comment to explain your thinking.

Interested in more info on the stocks mentioned in this story? Click here to add Google to your watchlist. Click here to add Amazon.com to your watchlist.

Adobe, Amazon.com, and Apple are Motley Fool Stock Advisor selections. Both our Motley Fool Inside Value and Motley Fool Rule Breakers services have recommended subscribers buy shares of Google. Motley Fool Options has recommended subscribers open a diagonal call position in Adobe. Try any of our Foolish newsletter services free for 30 days.

Fool contributor Tim Beyers is a member of the Rule Breakers stock-picking team. He had stock and options positions in Apple and a stock position in Google at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. You can also get his insights delivered directly to your RSS reader. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool owns shares of Apple and Google and is also on Twitter as @TheMotleyFool. Its disclosure policy doesn't take kindly to finger wagging.


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