March 21, 2011 | by Michael Heller
Almost five months ago, when we first got wind of the Amazon AppStore, I wrote that Amazon could become the default option for any devices that didn’t comply with Google’s requisite standards for access to the Android Market. In the months since then we’ve learned quite a bit about the Amazon AppStore. We know that the Amazon App Store will include DRM if the developer chooses to enable it. We know there will be an approval process. We know that Amazon will control the actual sale price of the apps, but never pay developers less than 20% of the list price as their cut. We’ve learned that Amazon will have exclusive rights to Angry Birds: Rio, and rumors point to a launch of the service tomorrow, but we still don’t know how Amazon is going to deploy the store itself onto devices.
Everything about the Amazon AppStore sounds very good, and sounds like it could be a very good option for developers. But, if it can’t get apps to the people, what’s the point? We’ve already seen Google remove the Kongregate app from the Android Market because Google doesn’t allow “competing software distribution platform[s] offering outside content” in the Market. This is also why the so called Tegra Zone app is nothing more than a portal to highlight games, and allow users to go to the Market to buy those games. Given these rules, there is no way Amazon would be able to put their App Store in the Android Market, which only leaves three options: going to non-standard devices, making deals with manufacturers, or viral distribution.
Non-standard devices and the international community
I realize that those first two options aren’t mutually exclusive, but I want to draw a line between devices like the Archos tablets, Notion Ink Adam or any of the myriad other devices not officially approved by Google, and any device which now currently has the Android Market, but could switch. The first category adds up to such a small proportion of the Android ecosystem as to be essentially insubstantial. Not to mention that the definition of “non-standard” is changing with the coming WiFi only tablets which will be allowed access to the Android Market. In the U.S., there is a fairly clear split in quality between devices that have the Google stamp of approval and those that don’t, but internationally there are far more quality Android devices that do not include Google apps. Internationally, Amazon will have a much bigger opportunity with devices not approved by Google. But in the U.S., a phone or tablet from a big name manufacturer like Motorola, Samsung, or HTC would lend more credence to the Amazon AppStore than being featured on the next Augen device.
That second category is interesting, because devices must meet certain criteria in order to come packed with Maps, Gmail, Market, etc., but those devices are not required to run those apps. A manufacturer may be able to bake in the Amazon AppStore to work alongside the official Android Market, but there is no guarantee that Google would allow that. And, a manufacturer cannot remove the Android Market in favor of the Amazon App Store without risking losing the entire suite of Google Apps. Since Amazon will only be offering a Market alternative, but no alternative to Maps, Gmail, Calendar, GTalk, or Voice, convincing manufacturers to use Amazon isn’t as simple as “our marketplace is better”. It must also be able to offer viable alternatives to the other apps. This could pave the way for a number of Android phones designed by Google competitors. Microsoft has already bundled Bing in Android phones, and a deal with Amazon could cut out Google even more. A real Facebook phone could also come from this.
Developer and user adoption
The approach of making deals with manufacturers assumes developer adoption. The Amazon App Store must have app parity, or else it will fail before it even gets out of the gate. In general, developers want the largest market, so I’m sure there will be a lot of cross-listing with Amazon. And, the addition of the exclusive Angry Birds Rio shows that even big names are willing to put their faith in Amazon. The question is more about smaller developers. For a long time now, smaller developers have been the driving force behind the Android Market’s growth. Amazon seems to have that covered by promising to waive the $99 developer fee for the first year.
The final option for distributing the App Store would be virally. We know that a leaked apk can travel a long way very quickly, and the tech elite/early adopters are some of the best sources of free advertising and distribution available. The trouble with this method is that ultimately, the reach is much smaller, because the barrier to entry is higher. You’re always going to have fewer users with an app that must be installed rather than one that comes baked in (just ask Internet Explorer and its shrinking market share). So, viral distribution could be a valuable option for generating buzz and support for the Amazon AppStore, but it isn’t the ultimate solution.
The Amazon AppStore seems to have most of the hurdles figured out. It looks to be a viable competitor to Google in price, and bringing in developers. It could possibly be much better as far as curation of apps. But, no matter how good the selection and pricing, a store cannot succeed without customers, and Amazon has yet to give any indication how they plan to get a critical mass of users. The international market is in need of an app store solution, and has more of an opening for Amazon, but the road is much more difficult in the U.S.