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There's nothing preventing Apple from signing up to be a Kindle developer and using the KDK to develop an iBooks app for the Kindle.

http://kdk.amazon.com/

I'd like you to point out any evidence that Amazon has excluded or rejected Apple's application, because I've never heard anything of the sort.

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They don't even need to do this. If you could purchase iBooks in the Kindle Mobipocket format, there's nothing preventing you from transferring them to your Kindle and reading them.

There are plenty of bookstores that sell books that work perfectly well on the Kindle without having anything to do with Amazon. Sci-Fi AZ is just one such independent bookstore: http://www.scifi-az.com/

"active content must meet all Amazon technical requirements, not be a generic reader, and not contain malicious code"

Depends on how they define a "generic reader" doesn't it?

Does not still prevent anyone from selling books.

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