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Amazon, Not Developers, Will Set New App Store's Prices
Trebortech writes "Looks like Amazon is changing the rules of the game for developers with their new Android App store. I'm curious how Amazon will determine the value of your app and if having control of your prices really matters."
The core of the linked article: "Here's how it works: When developers submit apps to Amazon's app store, they will be able to set a suggested retail price ('MSRP'). It can be free, it can be $50, whatever.
Then Amazon -- not the developer -- will set the retail price. It can be full price, it can be a sale price, or it can be free.
Developers will get to take home the standard 70% of the app's retail price (what the app sells for) or 20% of the MSRP (what the developer thinks it should sell for), whichever is greater."
He who has the gold makes the rules.
Mod Me Up. You'll make a grown man cry.
Imagine your country's economy working according to a similar scenario where everybody was paid by their employee according the same rules... Can you? It seems Apple can and did.
While it might seem unfair. It's not like it's the only app store out there. They can always submit to the one maintained by google. Unless there is something that prohibit them from doing so.
Seems like somebody didn't think this through. If you set your MSRP to be $1,000,000,000, you'll get $200,000,000 for every sale, no matter what they charge for it (as 20% of a billion is going to be greater than 70% of pretty much any retail price.)
Sweet.
GAAH! MY PRINTER IS ON FIRE!!! PUT IT OUT! PUT IT OUT!
I have to take the amount of money I plan to make, multiply by 5 and then announce it to Amazon? To which Amazon then either follows my lead (and make my app prohibitively expensive so nobody buys it) or decide it's too much, cut the price by like 50% and ... pay me more in the end?
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
That sounds a lot like how business was done in Hungary after WWII, and up until the fall of the USSR. Mind you, the distribution ratios were somewhat different, but the concept itself is the same. There was a central ministry that decided pricing, physical distribution and profit distribution for a given product, and nobody had any choice but to go along with their decisions.
I am a developer, I want $2 per sale, so I set the price at $10 knowing it will never sell at that price.
Amazon will then have it almost permanently on sale at $2.85, "70% off!" - which is coincidentally the 70% return mark.
The basic premise seems to me to be that Amazon will be able to offer huge discounts on apps because the developer nominally 'agrees' that their recommended sale price is offensively high - because the pricing strategy compels them to. But the developer gets decent money, so neither party loses. The only loser is the consumer who are being deceived into thinking they're getting a huge discount.
It'll be interesting to see how this plays in different countries - for instance the UK has no great respect for recommended prices and insists that items on sale are actually sold at full price for some (small, admittedly) proportion of the time. I imagine the rules vary by country, too.
so now every developer just sets their recommended price to 350% the price they would otherwise .
if amazon reduce it then you still get the same as their 70%.
if amazon don't reduce it then they've decided a higher price will mean higher revenue and the devs get more.
easy
thats the principle - once you let parties to get increasing control of any aspect of social life, it doesnt stop until you come up and forbid it.
seeing apple getting away with its antics and control mania, others have started to engage in it too.
now, what will happen ?
Read radical news here
Shouldn't developers get to charge a restocking fee if Amazon fails to sell some of their product because it set the price too high? It costs something to process returns after all.
What's the problem? Set the MSRP at 5 times the minimum you expect to be paid for each sale and let Amazon decide whether or not you get more. They have some experience at this; they're probably a lot better than you are at finding the optimal price point that earns them (and you) the most money.
Moderating "-1, Disagree" is simple censorship. Have the guts to post your opinion.
All of the developers should write the following to Amazon:
"Dear Amazon, Fuck Yooooooooooooooooooooooooooooooooou."
Then, they should go develop their apps and host their works elsewhere.
If you think about it, the 20% of MSRP thing is good for developers; Amazon is going to maximize their return, at the same time they're maximizing the developer's return, which is *at least* 70% of whatever Amazon is getting. If Amazon lowers or raises the price, it's because they expect a greater return (which means you'll get a greater return) and to be fair, they're probably better at setting a price to make the maximum amount of money than your average Indie developer. This means the 20% MSRP just means you'll get a larger cut than 70% if Amazon thinks they can make a killing slashing the price.
The only way you're going to get screwed is that if Amazon decides having your application priced in an uncompetitive way is going to maximize their return on another app. This is more of a danger than anything, because they might raise the prices of all competing apps to make one in particular seem like a "bargain" at the same time they advertise the hell out of it.
So if the MSRP that I submit for my app is a million bucks, but they think it is worth $1 -- someone buys my app for $1, and they pay me 20% of the MSRP because that is greater than 70% of the actual retail price? sounds great!
The main reason for doing this, I think, is so that Amazon can bundle apps from various developers. By taking over the " price management " amazon can determine the combined price without upsetting the individual developers (they will be getting their minimum anyway). Amazon's datamining will then go on and determine the ideal software "bundle's", everybody will be buying at Amazon because they get free-apps with some bundles. They will rule the WORLD, my friends. The W.O.R.L.D.
It's interesting and could somewhat work, with Amazon's experience in finding the perfect price point.
However, developers have some experience here too, and regularly adjust prices in the search for the perfect price point themselves.
All in all, I don't really get why we, the developers, should submit our apps to yet another app store. Aren't these things meant to make everything easier for everyone ? The consumer has yet another app store to visit, the developer another one to maintain. How will people even get the Amazon app store ? Why would people install it, seeing their phones already come with Google Market, which is of course a bigger store than Amazon's ? Even if Amazons store is pre-installed, would it actually be used ?
Take for example the Samsung app store for Android. It's pre-installed on all Samsung Android devices. There's only a handful of apps in it, and sales through this store are abysmal - so bad it's not worth the effort to have your apps available in there. And we sell quite some apps across various platforms!
Not to mention it's one more app store to track sales through, which is actually a lot of work for some of us. If you sell a lot of copies, you need to have your taxes in order, so you need to get the right reports from the app store. This will differ per country, but in our country (inside the EU), we need to charge 19% VAT for all sales made to European customers, and then hand this money over to the taxman. That sounds pretty straightforward, and it is, as long as you have the information about how much is sold (and for how much) inside and outside the EU. You can imagine this can be quite some work ( = money) for some of these app stores as their reporting is generally terrible (Google has the reports you want only if you are from the US or UK, or make less than 500 sales a day). The app store needs enough users and sales to warrant even bothering with the extra work, or it's a net loss to publish apps there. I don't see Amazon getting there any time soon.
Given that in this day and age, hardly any consumer will be swayed by claims of "n% off [absurdly high figure]", I think it's more likely that the core idea is that Amazon, if they so desire, can prevent free and potentially superior competition to paid apps (which being downloaded by everybody over the paid alternative would imply no profits for themselves either).
So this is the shape the long-anticipated "FOSS is damaging to the market" backlash takes in the end.
I am wondering if this could be a response to e-book publishers. On Amazon's Kindle store, the publisher sets the price which results in e-books costing more than their physical counterparts in many cases. It didn't use to be that way until Apple came in and negotiated new terms with the publishers allowing the publishers to sell direct to the consumer, just using Apple as a middleman and Amazon had to follow suit. This was called the Agency Model.
I suspect Amazon's profits went down once they lost control of setting the price on e-books, if for no other reason due to reduced sales by people not wanting to pay the inflated prices, so I see this as making sure that they retain pricing control.
This kind of agreement allows Amazon to undercut any competitor. If you have a contract with one seller that the suggested price is $10, and you get $7 for each copy sold, and you have a contract with Amazon, where the suggested price is $10, but they can sell it for less and pay you less, then Amazon can drop the price to $7 and they still make $2.10 on each sale, while their competitor will make nothing at that price.
And I am missing the comments that came up on the Apple Store, that 30% of the retail price is robbing developers.
to deal with previous buyouts, in this newsbit I just made up, apparently, there will be a new car store is to be opened... in this shop, the car dealer gets to set the price... maybe full price, maybe discount... maybe free :)
what are they smoking :)
Never antropomorphize computers, they do not like that
Business Insider and author of TFA, Dan Frommer, got several details wrong.
TLDR; Amazon prevents you from selling for cheaper on other outlets, or giving away free downloads or FOSS if you want to charge on the Amazon Appstore.
What does "MSRP" mean?
In the retail business (that's where the "R" in "MSRP" comes from) retailers make speculations on how many units they can sell at what prices over what period of time, compare to actual or theoretical negotiated bulk prices for purchasing from a manufacturer or wholesaler, and then decide whether or not it meets their profit expectations. It can be a little more complex than this, but this is the gist of it.
Well, the article linked to by Slashdot does not help you find Amazon's justification for using the terms "MSRP" or "SRP." My research, which may be incomplete, indicates that Amazon is not using this term, and rightly so. Here is an excerpt from Amazon's Appstore Distribution Agreement, which you can see in PDF form here (MD5 checksum 15636c42ecfb47dc819445ad3214eac4, just in case they change the file in the future without renaming it.)
Section 2a of Amazon's Appstore Distribution Agreement
Ok, so what we're actually dealing with is called a "List Price" in the legal agreement to supply Amazon's new App Store. This is a more correct term, because an MSRP is legally unrelated to the price a retailer secures from their supplier for units of the product. It's clear though that this "List Price" bears legal weight in determining the PPU (price per unit) of the product from the supplier (or, developer, I guess.)
So at this point what we have established is that the "List Price" in fact has no bearing on what the app will be sold for, but is defined to be five times the minimum PPU the developer is paid.
Here is a really important detail that Business Insider and author of TFA, Dan Frommer, glossed over:
Somehow, even managing to discuss the situation in which you set your prices differently for different sales outlets, Business Insider and Dan Frommer miss this juicy tidbit:
Section 5i of Amazon's Appstore Distribution Agreement
"List Price," then, is not simply five times the minimum PPU you wish to be paid (which would effectively allow you to actually set the price you want to sell at, which would be nice) but is in fact a function of what price you are offering, but a function of the price your app is available for at different outlets! This means if your app is on multiple outlets, Amazon takes away your ability to set your price through the List Price, and even
Doesn't this strike anyone as monopolistic behavior? It's kind of weird that the "manufacturer" will not be able to set their own price - it gives too much power to the distribution channel, which means the distributor can unfairly promote or punish the makers of its products...
Amazon sets the price for vanity (oops "self published") books by the page. At least if you self publish and have an ISBN you can set your own price. What recourse to app developers have? Perhaps the answer is for devs to steer clear altogether, or perhaps set up a cooperative where they have more clout to negotiate their own terms.
Which is why OPEN, REALLY OPEN is so FUCKING important ALL THE TIME. Even the if the closed evil is shiny it is still utterly and totally evil and a small evil might be tolerated but evil wants to grow and big evils are not so nice.
The Mac itself already shows this, WHILE the device is open, test just for fun how many apps that are for free on Linux and Windows cost money for the Mac. No, not the same apps, equivelant apps. Everything from an FTP client to text editors. Just because it is a Mac developers think people are happy to "donate" a few bucks. Hell, you can afford a Mac, you can afford some cash for code right?
Makes sense BUT it shows that ultimately most people dream of having so much cash in their pocket they need to pay someone to hold their trousers up. Greed is ALWAYS lurking around the corner.
And then you get yourself locked in and all that evil and greed has you under control. Want an application on your iPhone? PAY. Even free applications cost money, see the VLC debate.
There is a reason there are so many payment providers, so many different methods of parting with your cash, because a single closed in method always turns out to be to expensive.
Want proof? The US government is considering setting a max on what banks can charge in the US for Debit transactions. Durbin Amendment. Banks are in an uproar and threathen to raise their service prices that 5% of people will be unable to afford to use banks. Small detail? In Europe the transaction costs are far less AND nobody has to go without banking services because they can't afford it AND it is faster. Oh and EVEN that ain't as good as it gets, PIN transctions are cheaper still and FREE! So Free that PIN transctions are used for 1 cent to verify accounts.
Ain't competition wonderfull? The free American market has succesfully competed until prices are the highest and service is the lowest.
Amazon has gotten so big that they not only can dictate what and what doesn't not happen but that the effort in going around it might become to great. Yes, you can buy a Nokia phone with a real OS on it and run anything you want but how long will people continue to develop for that when so few are using it?
The iPhone and closed Android systems are a threath not out of themselves but because they upset the ecology. Anyone that thinks these are healthy probably looks at the map, sees countless seas of green farmland all with the same crop and nothing else and thinks "Well nature is doing all right, lots of plants, lots of growth".
Do we REALLY want the walmart effect to become part of every element of life?
Seems a lot of people do.
MMO Quests are like orgasms:
You may solo them, I prefer them in a group.
Listing on Amazon.com's store is appealing because it allows customers to purchase my apps without having to use Google checkout.
But there is no way that I'm letting Amazon discount my apps for me. I know the right price for my apps and I want to keep that price. I'm not just selling a game, I'm selling an app that has specific value to a niche market. It sells quite well on Apple's app store at those higher price points. I'm sure that Amazon.com's automated systems would see my high price point and discount the app.
My apps will stay on Google's Android Market, thank you very much.
Considering that you still take a fixed cut of whatever the price Amazon sells it for, what is the big deal? Amazon's interest in maximizing revenue from that product is as big as yours.
It all comes down to whether Amazon can take better decisions about pricing than the developer. Which truth be told, will probably be the case.
I only see this feature being unacceptable to a certain class of boutique apps where the price is extremely high for no good reason, but where the high price is also a part of the appeal of the product: things like Things and Delicious Library come to mind.
Thanks to this cluster f%^k I wont have to listen to people whine about the Apple Store for a while. Seriously if Apple said we're gonna give you 70% of whatever we decide is good or 20% of what ever you decide what do you think would happen.
Amazon is saying they can discount your app up to 70% any time they like an you have to give up the same amount from your cut.
Your selling an app for $10 and selling 100 a week earning a decent $1000 a week income for your hard work.
Amazon decides dump YOUR app on the market for $3 and they sell 1000 in a week making you $2100 nice right.
Now it goes back to regular price and your selling 10 a week for months because the sale wiped out the market.
You lost $4900 in future income in one week because of Amazon.
5 x .2 = 1
this allows Amazon to undercut any competitors price by 80 %
$10 app on Amazon and competing store.
on sale for $5 at competitor (50% off) - $3.50 to dev
Amazon can sell for $1 and still break even.
I cant see any serious developer giving Amazon control of its cash flow
In the real world (not Apple's we set the price point world) the manufacturer sets an MSRP then negotiates the terms at which they will sell units to retailers. Retailers with higher buying power will often obtain a bulk discount. This bulk discount goes towards them lowering their retail price and someone somewhere does some simple maths to find the optimum retail price point to maximise profits.
Go to www.amazon.com and have a look at how many products are actually sold for the full retail price. You like camera gear? Would you rather pay the Olympus MSRP of $1800 for the new DSLR or buy it for $1400 from the store? Do you as a developer know the price points and have teams of people dedicated to maximising profits from your product through a specific number of sales at a certain price?
The reality is the way it works now with developers setting price is rare. It happens with Apple who also happen to own the distribution chain from start to finish, which is why you rarely see fancy discounts on Apple products. But unless you own the entire distribution channel why not leave the selling to the experts? You can always offer your app on a website for full price and then scratch your head why you're getting a reduced fee from Amazon.
except the only way to load an app on iDevice is via the app store, so if i want to sell an app for iDevices, i have to go through them. At least i can side load on android.
Yup. A good reason not to pander to iSlaves.[1]
The Future of Human Evolution: Autonomy
Do developers think a pay portal is worth 30%?
Amazon sees themselves (rightly) as a retailer in creating this venue...that is *not* a provider of a marketplace. This is a very traditional and standard approach in how a retailer interacts with vendors. It has relatively good tax implications for vendors (simplifying their issues) and is efficient for the market. It does, however, present the interesting issue of creating two potentially radically different prices where apps are available in both Amazon's retail shop and other's vendor spaces. N.B. This, too, happens all the time in tradition retailing environments...but has been largely limited in the ether until now...
I hereby declare that the MSRP of my app is $1,000,000 per download. Amazon thinks it should be $1.99. Since $200,000 > $1.39, they pay me $200,000 per.
The only surefire protection against Microsoft infections is abstinence. - The Onion
This is bad news. Amazon thinks that it can set the prices for products that sell in its online store? Not only is this very bad but it could also lead to developers abandoning the App Store. This is the same problem that Apple is fighting with music publishers because iTunes set music prices at $1 across the board. For year after year, it had remained this way until Apple relented and decided to increase that to $1.29 per song. App developers have the advantage here because if they all band together and tell Amazon a big fat resounding "NO," that Amazon will eventually cave in. Without the developers, Amazon's App Store is dead in the water. They seem to think that since they're the big bully on the block that everyone will cave in. Trust me, there's going to be fallout over this one as the APP developers have Amazon over a barrel and they know it. They need to stop acting anti-competitive and start realizing that it is not retailers who set prices, it's the manufacturers, the companies who make that product, that set the prices, NOT retailers. They're just trying to find new ways on screwing their suppliers so they can get away with this BS excuse for wanting to set their own prices. Amazon has already gotten into trouble over this in the past (because of their practices in lowering prices far below than those of other retailers) because they've become the target of various anti-competitive lawsuits.
Try reading the article or even the summary.
Bad analogies are like waxing a monkey with a rainbow.
or your corner used game show, or your corner wall*mart. They're a store. They set prices. Don't like the prices they set? Market your wares elsewhere.
Isn't this the way selling your games on Steam works too?
You set the price, but have no control over when Steam places items on sale or what they actually charge.
It shows what a bargain Apple's store is. They only charge you 30%, not Amazon's 70%, of your asking price.
Bad analogies are like waxing a monkey with a rainbow.
Lots of comments here that're completely missing the point. This is to prevent you from selling at multiple stores at once. You see, in addition to setting whatever price they want, Amazon also has a rule which says that you're not allowed to set a "list price" that's higher than what you sell it for on other app stores. This means that if you put the same app in both Google Market and Amazon's store, then Amazon's store will always be cheaper - and you can't raise the price to counteract Amazon's discounting without ruining your sales on Google Market.
This is just one of several showstopping issues that ensure that I, as an app developer, will not put anything to Amazon's app store.
That sounds disturbingly like illegal monopoly price-fixing to me. Didn't we settle the issue a long time ago that retailers can't tell their suppliers what price to charge for their goods?
How about I name a price which Amazon will pay me for each copy they sell, then let Amazon decide what to charge to retail buyers? You know, like regular goods, the maker sells it for a profit, the retailer tacks on a their profit margin, and the Holy Free Market decides if it's worth it, and both creator and seller can adjust prices for demand.
Yes, I'm fully aware Wal*Mart uses its dominant position to manipulate suppliers into setting the price to Wal*Mart's like -- in a different enforcement regime (pre-Reagan) they'd be in trouble. I doubt in this 21st world that Amazon will ever get taken to task for it, though. The acolytes of the Holy Free Market will use the argument that if the Free Market doesn't like price-fixing, it will go elsewhere to sell.
The developer will suggest a price and then if Amazon chooses to go with it they get only 20% of the proceeds allowing Amazon to keep 80% of the money. Whereas if Amazon chooses a different price then the developer gets to keep 70% and Amazon keeps 30%.
Good grief. That's not what's happening. From the fine summary (emphasis added for the reading-impaired):
Developers will get to take home the standard 70% of the app's retail price (what the app sells for) or 20% of the MSRP (what the developer thinks it should sell for), whichever is greater .
So if you set the MSRP for your app at $100, then unless Amazon rejects it entirely, they will pay you at least $20 for every sale.
If they end up selling it for that $100, then they will pay you $70 for every sale.
Dan Aris
Fun. Free. Online. RPG. BattleMaster.
Isn't this what Amazon does with the book market? There is a MSRP that has included in it what the publisher wants as their cut. Amazon can sell at that price, a higher price or a lower price. The publisher is guaranteed their minimum cut.
If Amazon can sell twice as many books by lowering the price by 1/3, then everybody wins. If the book is popular and copies of that edition are rare, the price goes up (regular supply and demand at work), again, everybody wins.
It seems like Amazon is basically wanting to take an already established model and use it for their app store.
of digital slaves ?
Companies have been working hard to have work done for them for free.
Facebook is a good example, the users do all the work, facebook reaps the profits...
When will people realize that things are moving towards them becoming cheap or free labor for big corporations ?
This post in itself could very well be considered to increase the value of Geeknet Inc... but i'll make nothing of it :D
--
http://www.twilightcampaign.net/
Fine. I take my $3 app (my cut: $2), and list it as "MSRP: $9.95". Amazon sells it for $3. I get $2.
All this does is encourage unreasonably high MSRP values. Maybe that's what amazon wants... that way they can list everything at 60-70% "discount" off of a fictional MSRP all the time.
Let's not kid ourselves. Amazon will not sell at a loss. I don't care how leet you think their MBAs' customer spreadsheets are, there is no situation they will do this in.
What AC also refuses to acknowledge here, somehow while even discussing a situation where your product gets "bundled," is the possibility that Amazon could determine what fraction of the "bundle" your App is worth.
But let's be real about this: Amazon won't bundle. The language of the agreement makes it hard for them to bundle, unless they are the customer.
Section 5g does say this:
But that isn't enough, though IANAL
As another comment on here pointed out, just about everybody is missing the point of what Amazon is doing. This isn't something to benefit the customer - this is a monopoly move designed to wipe out any competition to Amazon in the app marketplace.
I'm going to discuss this in layman's terms. Now, for details on the contract, see this post, which shows you where things are on the contact and how they're working: http://developers.slashdot.org/comments.pl?sid=1951734&cid=34889086
This is an evil monopoly move by Amazon, and it isn't the first one. This is the third I've seen. The first was a move to wipe out print-on-demand printers used by the small press market - Amazon contacted several of the larger small press publishers and informed them that if they didn't switch to Amazon's in-house printer (a company called Booksurge known for shoddy printing jobs), Amazon would remove the buy button on their books. Amazon did pull that trigger, by the way, and it resulted in a class action lawsuit that put an end to that particular trick. The second was an attempt to wipe out any competition selling e-books - Amazon spun the dispute as greedy publishers wanting to price-gouge customers, but what it was actually about was that Amazon had tried to get publishers to sign contracts stating that Amazon would always get the lowest list price for e-books, regardless of any other arrangements past or future...including direct sales from the publisher's own website. The publishers fought that one and won, even though they took a PR hit for it.
This one is an effort to wipe out any competition in the app market by manipulating app developers. Here's how it works:
As the article said, the terms are set where the app developer will receive 70% of the actual sale or 20% of the list price (basically, the price the store is supposed to sell it for), whichever is greater. As was left out (and pointed out in the post I linked to), there's a clause in the contract stating that Amazon must always get the lowest list price.
So, if you're a developer, you need to calculate the list price of your product based on what you need to receive from each app sold. Let's say that's $4. But, with the terms of this agreement, you are only guaranteed that if it is 20% of your list price, so you have to set your list price at $20. Therefore, if Amazon turns around and sells it for $4.50, you are guaranteed to get your $4.
But, this also means that in order to ensure that you get that $4, you are now forced to overprice your product. So, everybody else who carries your product - including yourself, if you have your own little app store - has to do it at a list price of $20. In the meantime, Amazon can set the price to whatever it wants, and so long as it doesn't go below $4, it will make a profit on the sale. And, Amazon even makes it look like it is doing you a favour - after all, if your app sells for $10, you're going to get $7 from it. Amazon gets to have the lowest prices, and you - the developer - have made it so that every other app store gets thrown under the proverbial bus when it comes to your app, because they will never be able to compete while using the list price that you are forced to give them.
This is an incredibly dirty trick, and what needs to happen is that app developers need to fight back and refuse those contract terms en masse. If they can do that - like the publishers did with e-books - then Amazon will be forced to back down. If they don't, then Amazon will stand a reasonable chance of not only gaining a monopoly position, but actually wiping out any competition.
Robert B. Marks
Author, Demonsbane in Diablo Archive
I wouldn't have a problem with that.
I assume you can remove your app for sale at any stage, say for instance, Amazon decides to demote it to the bargin bins?
Why should there be any charge! Not nice to small developers :(
Amazon have no such automated mechanism in place currently and they've not mentioned introducing one.
Bad analogies are like waxing a monkey with a rainbow.
Amazon could simply refuse to sell apps where the developer sets too high a list price.
Wasn't that obvious?
Bad analogies are like waxing a monkey with a rainbow.
All of my apps have an MSRP of $350 billion.
Amazon is free to set retail price wherever they like, as long as I get my $50 per copy.
This could be fantastic if it were opt-in. As an iPhone dev I'd be extremely interested to see a recommended price point included in the sales reports I get, together with the option to have Apple automatically flex the price to track it, with maybe a baseline set. If they have the data and algorithms to do this well I might even be interested in letting them take more than the current 30% for distribution if the distribution were demonstrably 'smarter'....
It is a bit of a dirty trick, but the proof will be in the pudding. If putting your app on Amazon's store results in an overall increase in your revenue across all channels, it's worth having your app there. Conversely, if Amazon's sale-pricing of your app ends up over-cannibalizing sales on other channels with higher-percentage returns, the balance sheet will show it.
As I look at it, Amazon is essentially wagering that they can push at least 3.5x more volume of sales of your app (at 20% PPU to the developer) than you get from Google's Android Marketplace (which I believe returns 70% PPU). If they cannot do that, developers will be unlikely to continue publishing their apps there. Amazon will be looking to do this through sale pricing, bundling, coupons, targeted advertising, recommendations, and perhaps an Amazon Android phone.
I'm sorry, but I don't think that's it at all. Amazon isn't gambling that it will sell 3.5 times the volume to compete with Google's Android Marketplace - it's trying to force you to overprice your app to put Google's Android Marketplace out of business. As far as they're concerned, so long as the sales go through Amazon instead of somebody else, it's a win, and ensuring that you can offer it for far lower than anybody else can is one very effective way to make that happen.
Robert B. Marks
Author, Demonsbane in Diablo Archive
This about the smartest comment on here. It pisses me off when these half ass businesses assholes try making profit using monopolistic practices of the backs of the developers because Google is too lazy to come up with a well functioning App store. At least we know Apple does monopolistic practices and we have no choices. Now everyone and their mother will try to create an App store for the Android. I think all the comments are either trolls are people who haven't developed an App in their life.
would Amazon not have to buy the app just like say walmart buys HDTV's to sell from a wholesaler.
I completely agree, however the simple solution is for developers to release to similar products - an amazon special with a banner and a different name and another version. Manufactures do this all the time.
wait a minute -- the slashdot crowd, known for, `all software wants to be free,' and, `there is no intrinsic value in software,' is debating a pricing strategy? I think my irony meter just exploded.
Kjella is right! There is ambiguity in the terms concerning what the "list price" is. It says it is either the "the lowest list price or suggested retail price for such App (including any similar edition, version or release) available on any Similar Service or the lowest actual price at which you make such App available for sale through any Similar Service"
IANAL, so I really don't know how the "or" operator will work here. Kjella's suspicion of a legal loop between your contracts and prices with multiple vendors could force you ultimately to list for $0.00, though I doubt this is a deliberate move by Amazon, most likely it is legal incompetence!
AC has a lot of facts wrong and simply didn't read my post. Please don't read the post I am replying to without reading my post, as my post contains the excerpts from the actual agreement (which Business Insider failed to consider) which you actually need to make an informed decision.
Now for the AC I am replying to:
Please interpret "troubles me" as "troubles me about doing business with." While I am a free market advocate insofar as I think Amazon, like Apple here, is imposing restrictions on the market which hurt the consumer, what I was expressing was reasons I, and other members of the Slashdot community, may want to stay away from the Amazon market.
The parts you excerpted of my post express exactly what troubles me about them, and you appear to have extrapolated beyond them.
So the bottom line for developers becomes:
Divide what you want to make by 20% and you have your MSRP. Amazon will always be forced to AT LEAST pay you what you want... 20% of your MSRP -- or exactly what you wanted to make in the first place -- regardless of whether the app is full price, half price, free, etc. However, the bonus (to the developer, that is) is that if they choose to sell it for more than roughly 28.57% of the MSRP (71.43% off), then you'll end up with more than your desired amount.
Example:
You want $10. Set your MSRP to $50 ($10 divided by 20%). If your app is ever sold for $14.28 or less, you will make $10. If your app is ever sold for more than $14.28, you will make more than $10 (70% of $14.28 is roughly $10). If they determine, for example, that your app is worth $16.99, then you would stand to make $11.89 instead of your originally desired $10. The drawback, specifically to consumers/end users is that a developer, if its intention is to give an app away for super cheap (or free), will not be able to explicitly choose to do so if Amazon doesn't agree.
So, everyone will set the price to either free or $1000?
What's stopping you from creating a special "amazon edition" version of your app and giving it to Amazon with a 5 times higher MSRP?
The contract you sign with Amazon. If you did what you've just suggested, they'd hammer you for breach of contract.
Robert B. Marks
Author, Demonsbane in Diablo Archive
Conflict of interest here, any way you slice it. But not so different than mall contracts, which cleverly prevent internal competition.
Even malls don't have the balls to directly dictate retail price levels.
You are not allowed to set higher suggested retail price at Amazon then in any other shop. Read the hole agreement before posting: https://developer.amazon.com/
You are not allowed to set higher suggested retail price at Amazon then in any other shop. Read the hole agreement before posting: https://developer.amazon.com/
I guess they thought they can charge whatever Apple can changes. But then Apple charges for the developers kit not the shop usage.
You are spot on. Thanks for the posting. BTW: You forgot to mention: You have to sell all your Apps at Amazonl. So you can't have a special Amazon edition as well.
Amazon thought about that loophole as well: You have to upload all your apps in 14 days after agreeing. You need to upload new apps at Amazon 14 days before uploading them elsewhere. Read the hole agreement: https://developer.amazon.com/
For your loophole to work you need to found a 2nd company.
Another reply I cut copy paste: You have to upload all your apps in 14 days after agreeing. You need to upload new apps at Amazon 14 days before uploading them elsewhere. Read the hole agreement: https://developer.amazon.com/
For your loophole to work you need to found a 2nd company.
(that is the wrong found isn't it. Well, I am only a German, I don't know how the other one is spelled)
You are not allowed to set higher suggested retail price at Amazon then in any other shop. Read the hole agreement before posting: https://developer.amazon.com/
You need to sell all (or at least upload them for sale) at Amazon. For your trick to work you need to create a 2nd company.
But you would need to sell Pinball 2.0a at Amazon as well. Amazon wants all your apps present and future. For present you have 14 days to upload them *all*. For future you need to upload at Amazon 14 days ahead of any other shop.