A few days ago, we announced changes to our Android and iOS app stores. These changes reflect the underlying philosophy of app stores, which is to make sure that apps are discoverable and that app developers get paid for their work.
The change to how developers make money is going to be controversial, but the goal of getting better discovery and a fairer compensation for developers are not. Here’s why:
Google has had a 60% cut of revenue from the sale of apps in their stores for more than 10 years now.
The other way that developers make money is when they sell an app for a one-time fee. For example, when a developer sells an app that was previously free, they will receive 70% of the price they charge in our store.
Let’s look at the Android case. Our analysis suggests that as of November 2016, Google takes $4.19 of every $10 that developers charge in the store. Of that, $2.48 is taken in the form of a 30% cut of any purchase that we make from our developers. $1.00 goes to the Play Store for that developer. The developer keeps $0.61.
By contrast, a developer can make roughly the same amount from a free app that is downloaded through search and through app recommendations. In other words, when we have improved discoverability and search, developers will make money by offering these apps for free. And by making changes that are supported by everyone, we can improve how developers use our stores, improve our own experience, and hopefully help our Android developer community.
From a business perspective, our goal in app stores is to be on the winning side of the long term. At Amazon, we spent 10 years fighting for the right to sell other people’s products online. We spent years building a network of retail partners. And we fought hard for access to inventory from publishers that wanted to sell their own products on Amazon. It took us years to convince publishers that doing so would increase their sales and profitability. The same will be true for app developers and Android users. The good news is that it will take only a few days to change the Android app store to give developers an alternative way to make money. And this will all help users to find apps that they’re looking for and for developers to make more money.
What’s Next?
It is my hope that developers will see these changes as an opportunity to help Android users discover great apps at a fair price. The only thing that matters is that users have more apps to choose from. So if developers think this change will make their apps less discoverable, their apps won’t appear in our stores. This is what the market is for — it is for the benefit of users and developers. And the more apps the market can get, the more users will be satisfied and developers will make money.
If you have any questions about the changes to Android or the future of app stores, I hope you will contact our stores team at android-stores@amazon.com.
Tim
And if you’re looking for your next Android app idea, you can get started here.
I’m really excited about the changes that Amazon Appstore is making to its store policies to help developers build better apps. As a long-time Android developer and advocate, I’m excited about a future where developers can make a better living developing apps that help users and makes it easier to be a mobile app developer.
My first Android app has been in the Amazon Appstore for a few weeks now. I’ve been really enjoying using it and I think it’s going to really help me understand the market better as I consider different app ideas. But now, with the recent changes announced by Amazon, I am seriously considering using Amazon’s Fire phone app store. And I think many developers should take a look at how the Fire phone app store is doing things.
When I first used Amazon’s store, I was instantly struck by two things: first, that it was clean and simple, and second, that I could see more popular apps in the store immediately than I could on Google Play. Both of these were great ideas. I’m also impressed by how quickly some of the apps I’ve been looking for have appeared in the store. I haven’t used a lot of apps to put the Fire phone in the ‘high use’ category, but it’s a good start.
On the other hand, there are a few aspects of Google’s app store that are really annoying me: (1) it seems very difficult to actually figure out which apps are paid and which ones aren’t, and (2) it seems as though Google (especially in their Android Play Newsstand app) doesn’t prioritize high quality apps. In fact, Google just doesn’t seem to care about quality at all. They do, however, seem to care about getting paid by app developers. And on both counts, Amazon seems to care a lot more about my experience with their store. I think both Google and Amazon have valid business interests, but I think Amazon can get a lot more done by focusing on the experience.
I’m not saying that Google and Amazon should be at odds. I’m only saying that Amazon has managed to create a better experience in a market where Android users are still in the minority. The great thing about it is that, as more people discover Amazon’s app store, more people will want to buy an Android phone. And that should only serve to increase market share.
When we were first getting started with smartphones, we set out to change how mobile phones were designed, built, and sold. We did it to make our customers happy. It was a lot of work, but we did it because our customers kept coming back and telling us it made their lives better. Now, Google and Amazon have the opportunity to do the same thing with app stores for smartphones. I don’t know if they’ll do it, but I hope they do.
My new (free) app, Apparatus, was designed to help people solve their problems by using their own devices and the services they know how to use. It’s a lot easier to use an iPhone to solve a problem than it is to solve it with any other Android app. The first problem we tackled was to help people find local services that help them do something specific that we can’t do, like find a locksmith or a restaurant that delivers.
There are hundreds of apps on the market that can do these kinds of things, but I don’t think any of them are as easy to find as the ones I have in my Apparatus app. Our new web site has an even better view of the services and information available in your area. It’s all designed to help you find what you need, fast.
The next big challenge we’re going to tackle is to help you find out how to do something once we
