Key Features

• Buy a Kindle book from your Mac, PC, or iPhone using a Web browser and wirelessly transfer the books to your iPhone
• Read first chapters of any book for free before you buy
• Download the Kindle books you already own for free - they are automatically backed up on Amazon.com
• Adjust the text size, add bookmarks, and view the annotations you created on your Kindle
• Access your Kindle books even if you don't have your Kindle with you
• Automatically synchronizes your last page read between devices with Amazon Whispersync

The Whispersync technology saves and synchronizes your reading location across your Kindle(s) and your iPhone.  This simplifies the reading experience as your Kindle will know which page you left off on your iPhone.

Analysis and Commentary
This move by Amazon has nothing to do with form factors or devices.  Amazon makes the following statment on the Kindle of iPhone page:

"Get the best reading experience available on your iPhone or iPod touch"

This statement demonstrates that Amazon doesn't care very much about making money through sales of the Kindle device.  Amazon's goal is to become the dominant ebook retailer and the new iPhone application clearly demonstrates this ambition.

Amazon's first move - creating the Kindle
Amazon's creation of the Kindle device and subsequent release of the Kindle 2 devices is an example of a vertical integration network mobilization strategy.  This was simply to jump start the ebook market given their existing platform of bringing book buyers and sellers together.

Amazon's second move - releasing the Kindle for iPhone Application
By releasing the Kindle iPhone application Amazon has simply conducted an Intermodal Attack with respect to Platform Envelopment.  Amazon wants to dominate e-reading.

Amazon is the dominant Internet-based "platform" for bringing book readers and content publishers together.  Amazon's foray into Digital books is a strategic move in an effort to dominate the e-book market.  In order to do this, Amazon simply created the Kindle to leverage its key asset of bringing book readers and book publishers together via the Amazon platform.  The creation of the Kindle as stated above was a network mobilization strategy.  By releasing the iPhone application, Amazon is sending a clear message that it doesn't care about the device, it simply wants to capture and control this particular market.  Amazon will make money from the sale of books, not devices.  Furthermore, Amazon is trying to preempt ebook sales from Apple via the iTunes store.  Note that it's also a move against the Stanza application.