Linked by Anonymous on Fri 7th Jan 2011 19:31 UTC
PDAs, Cellphones, Wireless Amazon is preparing to open an Android app store to compete with Google's Android Market, and has launched a beta portal where developers can submit applications for Android-based smartphones. The applications will be sold on the Amazon Appstore for Android, which the company expects to launch later this year, according to information on Amazon's developer portal. Users will be able to shop for applications from their PCs or from their smartphones, and pay with their existing Amazon account.
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RE[2]: Hang on!
by matto1990 on Sat 8th Jan 2011 19:54 UTC in reply to "RE: Hang on!"
Member since:

I'm not sure you read the link I gave at all.

I totally agree; Amazon knows much better than me how to make money. I'm not denying that. However it's not me that they want to make money for, it's them.

Consider these 3 scenarios from the comments of that post:

1) Contrary to my hopes, the app is not popular. It sells 500 copies on each market, earning the company a total of $700. Amazon don’t bother to promote or discount this unpopular application.

2) The app is well received, it sells 50,000 copies on each market, earning the company a total of $70,000. Amazon decide to adjust my price in an attempt to boost sales. It works, the price is halved and it sells an extra 100,000 copies at 50c netting an extra $35,000. Relief, the company has broken even (anyone who has actually run a company on a P&L basis will empathize at this point) but with a profit of only $5000. Note however that Amazon have made any further sales in the Google Market very unlikely.

3) The app is wildly popular and 1M people want to buy it! If the pricing remained unchanged, this would bring the company $700,000 revenue. But Amazon are tracking the download numbers and the interest in the application becomes obvious immediately. Amazon reason that by reducing the sale price of this popular application they can double their sales of the application by taking all of the sales that would have gone to the Google Market. They will also benefit from the additional traffic to Amazon Market in the form of extra sales of other applications. So they halve the price; it makes little difference to the number of sales because people want the application anyway. Every purchaser buys the application from the Amazon Market instead of the Google Market because it’s cheaper there and the company makes $350,000. Amazon have just cost my company $350,000!

Now I'm not denying that Amazon will help you make money most of the time, however by allowing them to set the price as they see fit you're allowing them to lower the amount of money that you are receiving for the product that you created for them to sell.

I'm not sure I agree that given this risk that developers are taking it's fair for Amazon to require that the list price you set on their store is not higher than the price you sell it for on any other marketplace (this includes if it's under promotion on any other store). To me that's a little unfair given the (very slightly) higher risk will selling on the Amazon market.

You don't have a lot of options if they do start selling your application at a price you don't agree with either as they leave the application on the market for 10 days after you request it's removal.

I'm not saying that the Amazon market is totally bad for developers, I'm sure that it will be fine most of the time and developers will make a lot of money for it. I just don't think it's worth forking out the $100 fee just to be allowed to submit your apps in the first place. Like the blog post I linked to says, that's a bit steep considering Amazon won't provide support with developing in the same way Apple do for the same fee.

Reply Parent Score: 2

RE[3]: Hang on!
by vodoomoth on Mon 10th Jan 2011 09:56 in reply to "RE[2]: Hang on!"
vodoomoth Member since:

Thank you for the link you posted. This is a very edifying post which doesn't paint Amazon in a vivid color... I'm baffled as to how companies are willing to lay their filthy mitten on other people's work without a common sense justification, and that there are always some people to justify it like that Bell character on Sutton's blog.
Unless the terms of contract have changed, there is no way I'm writing an app and selling it on Amazon. Just the "we get to set the price of your apps" is enough to push me away.

Reply Parent Score: 2