August 03, 2011, 7:44 AM — Amazon's Appstore is in the news again. This time it's developer Shifty Jelly who is speaking out against Amazon's terms and its treatment of developers. You may recall shortly after the Amazon Appstore launched, the IGDA (International Game Developers Association) spoke out against the terms (see: Amazon's Appstore not such a great deal for developers).
In Shifty Jelly's case their Pocket Casts app, normally $3, was the free app of the day a few weeks back. Before Amazon positioned Pocket Casts as the free app they contacted the developer, notifying them that they'd be offering 0% revenue share for the day the app was being given away. That in spite of reports that they promised either 70% of the sale price, or 20% of the list price on any app sold, whichever was higher.
Shifty Jelly opted to take the deal, and during the day their app was free it was downloaded 101,491 times. By their accounting, the 20% revenue share rate would've garnered them almost $55,000, but since they'd agreed to the terms they got nothing.
In response, they say they had about 300 support emails/day to answer, and had to beef up the servers they use to parse podcast feeds. In the days following the free day, sales dropped back to their normal few a day. The end result for Shift Jelly sounds like it was a net loss in terms of both fiscal resources and manpower. There's no indication that the improved visibility or increased brand awareness has helped with on-going sales.
You can read a lot more details on their blog.
Coincidentally (maybe, or maybe Shifty Jelly wrote their story in response), just the day before Shifty Jelly's blog post hit the net, VentureBeat posted a lengthy interview with the Amazon Appstore's director, Aaron Rubenson. Rubenson paints a very different picture, unsurprisingly:
VentureBeat: The International Game Developers Association was pretty concerned about what was going with app pricing. They felt the developers were losing control of app pricing under the contracts they signed with Amazon. What is your explanation?
Aaron Rubenson: When we looked at how we thought we could add value in this market segment, what we realized is that we are equal parts technology company and retailer. And the fact that we are a retailer at our core makes us a little bit different because we know about marketing and merchandising and proactive promotion activities like we were just discussing.
And so when we launched the store we did it in a way that’s a bit different, where we are actually the seller of the apps. And as part of that, that means that we are ultimately setting the sales price that the customers will pay for that app. And the reason we made that decision was that it gives us the broadest amount of flexibility in terms of marketing and merchandising and proactive promotional activities we were talking about, which we think is a real value for the customers. So it is different. There is no question about that. But we think that it is also proving to be a good decision because it’s working, it’s resonating with our customers.
VB: So you are having sales success as a result of this?
AR: That’s right. The customers are reacting positively to the store. The developers have been happy with the sales they get through stores. So the model seems to be working.
(Emphasis mine on that last answer.)
So who are we to believe? Amazon or an actual developer? Shifty Jelly discloses that they could have said "No" to having their app as the freebie of the day and that they went forward with it as a kind of experiment, and got a bit burned. They claim they haven't noticed any bump in brand recognition or residual sales. Amazon, of course, got to build good will by giving away more apps, and since they didn't do the deal without approval from Shifty Jelly no one can claim foul play on their part.
Maybe I'm just too focused on sticking up for the little guy, but I'm still seeing Amazon's Appstore as a place to avoid if you're an Android developer. If for some reason you want to avoid the official Android Market, there are other options such as GetJar that don't have the negative reputation that Amazon is getting.
Still, I'd love to hear from a developer who has had a positive experience by using Amazon's store.