Online retailer Amazon.com has purchased the development firm behind the most popular eBook reader application for Apple’s iPhone in a bid to extend its reach of the digital book market beyond its Kindle device. The old saying “If you can’t beat ‘em, join ‘em” comes into play here.

Lexcycle, makers of the Stanza application for the iPhone and iPod touch, announced the acquisition on its website this week, saying its “excited” about the transition and that it “could not think of a better company to join during this exciting time.” They appear to like the word “Exciting” or some form of it.

A free application downloaded more than 1 million times by App Store shoppers, Stanza (App Store) offers users 24-hour access to a catalog of over 100,000 eBooks in the open ePub format, an eBook container not supported on Amazon’s popular Kindle digital reader device.

Outside of broadening its reach to alternative eBook technologies, the retailer’s strategic motives behind the move are unclear. However, Lexcycle told customers the deal shouldn’t affect the way they acquire and enjoy eBooks through Stanza.

For Amazon, the acquisition comes a little less than two months after it announced a free application that lets users of Apple’s iPhone and iPod touch tap into its catalog of over 270,000 eBooks formatted for its $359 Kindle 2 wireless reading device.

Whatever plans they do have, they’ll be something we’ll keep an eye on.