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Daily deals giant Groupon has to be wondering what it did to anger the largest e-commerce player in the market. According to The Wall Street Journal, Amazon is not only launching a daily deals program, called Amazon Local, but the initial rollout is coming to Groupon's backyard of Chicago.

Not only is Amazon trying to stick it to Groupon, the e-commerce giant has employed the services of its partner and Groupon's largest competitor, LivingSocial, to be the sales force behind merchant partnerships with the service. The WSJ notes that Amazon plans on hiring its own sales force but it is a clever move by the company to outsource the sales team initially so as to ramp up the service quickly. Amazon has rolled out the service in Seattle, Boise, Los Angeles and Palm Beach, Fla. Groupon is in its six-month quiet period after filing its S-1 for an initial public offering and cannot (reasonably) comment on the proliferation of clones and competitors gunning for large slices of the daily deals pie. Will Groupon be able to withstand the mounting army of competition?

Amazon announced today its fifth annual Amazon Web Services Start-up Challenge for entrepreneurs using AWS. This year the contest has been expanded globally and will reward 15 regional semifinalists, five each from the Americas, Asia Pacific and Europe/Middle East/Africa. This time Amazon has teamed with YouNoodle.com, a global entrepreneurship network and contest platform to help administer the contest. Past finalists of the AWS Start-up Challenge include Justin.tv (in 2007), cloud-computing email productivity service Sonian Corp. (2008) and Yieldex.

AWS and other cloud providers like RackSpace have been pivotal in the next-generation explosion of web and mobile applications that have changed the dynamic of the current era of technology disruption. Amazon's ease-of-use and elastic pricing model has lowered the bar for startups looking to experiment with their products and scale quickly. By opening the contest to a worldwide audience this year, Amazon has set its sights not just on the Silicon Valley crowd but also on disruptive developer hotbeds across the globe.

Amazon announced earlier today that it has reached a content licensing agreement with NBC Universal to stream video over its Amazon Prime Instant Video service. The agreement fleshes out a growing library of content offered by Amazon of 90,000 TV shows and movies of which NBC Universal will add about 9,000. Amazon still trails Netflix and Hulu in total content licenses, which brings up an interesting point - what is stopping Amazon from kicking the tires on acquiring Hulu?

On one hand, it makes a lot of sense. Folding Hulu into its Prime package would give Amazon almost a million more paying premium video subscribers, dramatically increase its content library and add legitimacy to its nascent Instant Video service. Amazon is among one of the few companies that can comfortably afford Hulu and it presents less of a threat than Apple or Google, whose deep pockets and wide reach have been disrupting the networks and studios for years. It seems like perfect match ... or does it?

No matter how much chatter surrounds the rumored Android-based Amazon tablet, the company won't reveal any details. But according to Retrevo, Amazon leads the pack among manufacturers, excluding Apple, from whom potential customers would "seriously consider buying a tablet." And which tablet feature matters to consumers most? The price.

Amazon posted its financial results for the second quarter of 2011 today. The big news was that sales hit $9.91 billion, a 51% increase from the same period last year. But there were few details about Kindle or e-book sales, although the company did note, unsurprisingly, that Kindle sales were up compared to first quarter 2011.

The word "tablet," which has been murmured excitedly by Amazon followers for some time, came up only once during a conference call with company CFO Thomas Szkutak after the earning announcement. The question received this non-response from Szkutak:

Amazon unveiled a Kindle Textbook Rental, giving students the ability to rent instead of buy digital textbooks. Amazon says that, "tens of thousands" of titles from some of the major textbook publishers - including John WIley & Sons, Wlsevier, and Taylor & Francis - will be available for this school year.

It's not just the selection that the company is touting, of course, it's the savings: "now students can save up to 80% off its textbook list prices by renting from the Kindle Store." Amazon's boasted savings for students has put the company at odds with brick-and-mortar college bookstores, and the National Association of College Stores has accused the online retailer of misleading students about the potential for savings when buying textbooks from Amazon.

While Amazon has yet to confirm anything about its long-rumored tablet, new details have emerged about two new versions of the Kindle e-reader that could appear in the third quarter of the year. According to The Wall Street Journal, one will have a touch screen while the other will be an "improved and cheaper" version of the current device. Both will continue to use electronic ink technology, which gives text on the Kindle the appearance of ink on paper.

The e-reader market is growing quickly, and the Kindle's aggressive pricing has appealed to consumers. It's not surprising that Amazon is introducing a new version. But Amazon's entry into the full-color, backlit tablet market, which is also expected to happen before October, presents a potentially significant disruption.

The tablet component orders for the third quarter are in. No surprise, Apple is still miles ahead with orders between 14 and 15 million iPads on the way.

What is surprising is that Amazon has finally made a real, physical blip on tablet radar. According to DigiTimes, Amazon has ordered up to 1.2 million touch panels, a major component of tablets. Considering that the giant online retailer has not made an announcement nor verified rumors that it is releasing either smartphones or tablets, this is the first concrete piece of news that we have that Amazon branded devices outside the Kindle are on the way. Is Amazon showing too much confidence in its tablet strategy with its initial order?

Ownership of e-readers is exploding, according to a survey by Pew Internet Research. Over the past six months, ownership of e-readers such as the Amazon Kindle and Barnes & Noble Nook has grown from 6% to 12% of U.S. adults. E-readers are more popular than tablets devices such as the iPad or various Android slates like the Samsung Galaxy Tab which are owned by 8% of U.S. adults.

According to Pew, e-reader and tablet ownership is led by Hispanic adults, adults younger than the age of 65, parents of children below the age of 18, college graduates and households with and income of at least $75,000. While the Pew research is an interesting look in to the state of the mobile reader market now, it is important to note the timing of the survey and movement of the market to distinguish actual digital trends.

Having recently opened an App Store for Android to compete with Google's App Marketplace, Amazon is now taking on Apple with a launch today of a Mac Download Store. Amazon says that the store currently contains about 250 software and game titles.

That number is far fewer than the thousands of titles that were available at the launch of Apple's App Store in January. But Amazon is already offering titles that you can't find in Apple's store - most importantly perhaps, Microsoft Office.