Fresh in the wake of reports that Google will spend at least $5.3 billion on Groupon, LivingSocial — the Avis of deal a day — has announced a $175 million investment from Amazon. It simultaneously announced an additional $8 million investment from Lightspeed Venture Partners.

“If you want to become the biggest local commerce player, it makes sense to have the largest commerce site as an investor,” said CEO Tim O’Shaughnessy in a Facebook post.

Concurrent with the deal announcement, LivingSocial announced that it is averaging $1 million a day in booked revenues. While current revenues may be $300 million, it is projecting well over $500 million in revenues in 2011. It also reports 10 million e-mail subscribers. By comparison, Groupon was estimated in a report today to have 35 million e-mail subscribers and a run-rate of $1 billion a year, or twice the general assumption that Groupon makes $500 million a year.

While LivingSocial and Groupon are battling each other for deal-a-day in major urban and suburban areas in the U.S. and abroad, there are some key differences between them. First of all, LivingSocial is aggressively verticalizing in a different way from Groupon, which seems focused now on extending to SMB marketing services. Recently, LivingSocial acquired Urban Escapes, an launched LivingSocial Escapes, a travel site that offers savings on “curated adventures.” It also launched two other verticals: LivingSocial Family Edition and Campus Deals.

Another big difference: LivingSocial uses its own feet-on-the-street salespeople in each market, while Groupon relies more on its massive telemarketing presence.

The investment from Amazon in LivingSocial is interesting on several dimensions. It complements Amazon’s long-running “Today’s Deals,” which has its own massive list, and Woot, a recently purchased deal-a-day site that features products. With the new investment, and assumed partnership, those sites can go more local, while LivingSocial offers occasional national deals.

The investment also revisits the notion of Amazon as a local player, an idea pretty much dropped a few years ago, when Amazon abandoned its A9 local business directory. There always seems to be a massive opportunity for deal a day to morph into a dynamic directory and city guide.