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The AZW and AZW3 extensions are two proprietary EBook formats from Amazon and are exclusively used for Amazon Kindle devices. AZW is the first version of the two and was released in 2007 along with the first kindle, The eBooks with AZW format can store components like formatted text, bookmarks, annotations, last read position, page numbers that match up to the physical version of the book.
AZW Format: Its designed for Amazon Kindle devices for their own ebooks, It supports few main elements which has been explained in this blog