No you are correct, it is a distribution channel but depending on the artists label and contract, the deal to distribute can be done with either the label or the artist (or managments etc).
Amzon are hardly doing what Apple is doing. Amazon are mearly adding in a bonus mp3 (remixes in the main) if you download the album.
Apple are stopping artists releasing entrire albums by threatening not to distribute for them in future. It's happened to a friend of mine, she has just been signed up to have her first album only available on iTunes, pretty much killing off any chance of her doing ok out of it. Apple are not going to promo her album it will just be available under new releases.
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