He knew it was a bad deal, and that it didn't seem to work with their business model, but he did it any way (as pressured by other people in the company, which he admits). There's absolutely no surprises for them in this post, just regret. Sure, they didn't "realize" that it would garner so many free downloads, but that was always a chance, and in any case could have been quickly determined before agreeing by contacting other developers of featured apps.
The one piece of legitimate news here is that app of the day developers aren't being compensated at all, but that comes no where near justifying "rotten to the core", especially as they're all well aware of the terms when they agree to them.
He seems overly concerned with people who download the app just because they think it will trigger some micropayment to the developer, but that can't be a large number of people (developers paying attention to the launch terms of the market) and in any case are very unlikely to make up much of his support burden.
In the Apple store, if you got that many downloads and that kind of placement, the traffic from the various lists and high placement for 7 days would convert to many many paid sales over the following days.
We suspected it was a bad deal, but tried it anyway as an experiment. Our blog post wanted to point that out, but more so we took issue with the fact that most people think Amazon pays 20% of the asking price even when an app is given away. Their agreement with devs says as much. No one seems to know that to be featured you have to agree to 0%. Again we agreed, but the secrecy is where our beef lies, we wanted to make that public.
I agree strongly that Amazon needs to make this clearer in their emails an admin pages (listing earnings that don't exist is terrible) but as far as their agreement goes, I think you are mistaken.
Section 2.a. of the Amazon Appstore agreement, emphasis mine:
"a. Royalty. For each sale of an App, we will pay you a royalty (“Royalty”) equal to the greater of (i) 70% of the purchase price or (ii) 20% of the List Price (defined in and subject to section 5i) as of the purchase date. No Royalty is payable for Apps with a List Price of $0.00. Such purchase price excludes taxes and any separately stated fees or charges. A Royalty is due only for sales for which we have received final payment from or on behalf of an end user. If an App is purchased using a credit card or bank account deduction mechanism, final payment will be deemed to have occurred when the applicable credit card company or bank has fully settled the payment for the applicable purchase."
I strongly doubt that "most people" think that Amazon pays 20% of the asking price to the dev. Maybe if you limited your audience to "Android developers very interested in the Amazon App Store", but that's really a pretty limited audience, and not who your app is targeted to. Has Amazon ever trumpeted that 20% figure to the public? No. I mean, I work for a competitor, and am ready and quite willing to see the flaws in their model, that's a horrible thing to compete against, but it absolutely does not surprise me that they're not giving away their money. I mean: it's clearly not necessary. Once they run out of indie devs willing to give their app away for nothing other than incredibly great exposure, then maybe they'll need to start paying out, but not before.
That's absolutely incredible.
It's also the first I'd heard about difficulties with the Amazon App Store (which, if I remember correctly, was opened to great fanfare about how developer & user friendly it was)
It does seem as though Android is an incredibly difficult platform to make money on though.
This site has been littered with complaints (& plenty of iOS-vs-Android posts) about the dev process and lack of buyer activity.
I've actually found myself buying more than I otherwise would have, as a result of this sentiment. I want to support Android dev, and my credit card seems like the most logical way to do that.
Funnily enough, I've never even considered the Amazon market. I wonder what type of people do...
A large part of the problem is the "race to the bottom" mentality. Users have been taught (by Apple) that software is $0.99 - if not free. You have to get massive user numbers before that becomes profitable, or find another way out of the trap.
Google's Market is pretty good, and there's always the option of self-distributing (Swype does this and it is still very popular).
I wouldn't use Amazon's App Store after reading things like this. It's less usable for customers and it takes a lot out of the developer's control. However, I've seen developers handling this very badly. For example, they get shocked by the way the Free App promotion works (starting with the fact that it's FREE) and then try to remove the app from the store and deny those customers all further access to updates and the ability to reinstall (which may be wanted reasonably often if you use custom firmware). I don't care if you sold it for $0 or if you got burned by Amazon, that's still a bit of a bait-and-switch.
The 'race to the bottom' on pricing diesn't seem to have hit the Android market in the same way as the iOS app store, from what I've seen.
I've not had any difficulty justifying paying more for an app/game, thanks mainly to the 15 minute refund window.
Bad handling on the developer's part is a valid complaint alright. I'm sure it's frustrating and painful to have to support potentially large numbers of users (note: not customers) for no gain whatsoever.
That, along with the obviously lacking editorial control to respond to troubled users is a glaring red flag to steer clear of the system.
Users, customers - if you do a free promotion, you're doing a business transaction with them. It's not like they went and hunted up a rogue APK.
15 minute refund is usually good enough to run the "does this work on my device" check, although it doesn't always cut it if there are network issues or if something crashes or what have you. I'd be more comfortable buying more casually if it was longer, but it's much better than not having it. (Another reason not to buy from Amazon.)
Users/Customers: I agree that they're the same thing in this case.
I just don't like how the enormous volume of the free users, compared to the tiny number of paid ones, has resulted in them having to up their actual hardware costs just to support the system as a result of this :(
Yeah. It's often a poor value proposition and can cause a lot of negative fallout if you aren't prepared for and planning to exploit the numbers it generates (see also: Groupon).
It would be very interesting to see what big-ticket participants thought of the process (e.g. Angry Birds, Plants vs. Zombies).
I installed the amazon app store. Mostly because I was on amazon looking for a book and the free app of the day sounded interesting. I haven't actually looked at it since then. One thing to be aware of, apps from the Amazon app store have Amazon specific DRM if you uninstall their app store any apps gotten through it stop working.
edit er, where'd the post from the guy running an appstore go?!
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He also linked to a post earlier in July by the Apparatus creator, who complained of more or less the same thing.
Good spot though, it'd be nice to clear this up. It would also mean a nice payday for the dev too, of course.
Unfortunately, this alone wouldn't solve the other (serious) problems with the store though. Of course, it may mean that the devs in question just don't care about the problems anymore...
Sorry, I thought I deleted it before anyone had a chance to respond to it (I noticed something inside of it that was sufficiently confusing that I was going to try to follow up on it rather than broadcast it harder, as I was concerned I was just going to add /more/ confusion to the mess).
Regardless, as someone responded, here is the original text:
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Can you please make very very certain that you are not going to be paid that $54,805.14? As someone who runs an app store (and therefore am deeply embedded in “the lingo”), I think you are misinterpreting every quote and screenshot you have provided from Amazon. If not, then Amazon is being /incredibly confusing/ and that is a serious issue that should be frowned at.
Starting, Amazon said that the “price” of the placement is a “0% revshare”: I interpret that as meaning that they are going to /take/, for them, 0%, instead of their normal 30% revshare; this is backed up by their later phrasing “Amazon will not receive any sales rev share” and “at no cost to you”.
They then provided you a statement that claims that “sales” were $0, which is correct (the copies were all free), but the /”earnings”/ were $54k. This $54k is in the same column as the other parts of that table for “money the developer earned”, and simply would have no reason to be calculated in the first place if they were intending on giving you $0.
Finally, if we work the math out from that chart, we get that you normally get $1.89 per sale, making your normal sales price $2.70. On that day, however, for the 101,491 free copies, you got $54,805.14, which just so happens to exactly work out to 20% of that normal sales price, which is what everyone seemed to believe is what Amazon normally distributes.
To me, the way this reads is that normally they will give you a crazy placement on their site, but only if you pay them something: maybe if you give them 5% revshare (in addition to their normal 30%) they will elevate your product with “main page placement”. However, as the Free App of the Day, they do this for 0%: something they consider so important that their e-mail makes it bold.
So, really: are you 100% certain that you are not going to be paid that $54k? If so, Amazon really needs to get their wording more clear. Can you please please verify this?
For what it's worth, I initially read the emails and earnings statement the way that you described, and I thought to myself What in the world are these guys objecting to?! This is an incredible deal!
While true (I got a response on the original blog from the author that makes me feel confident that he is, in fact, not being paid the 20%; Britta also managed to find a few other reports of people not being paid), the reason I deleted it was simply that I realized that the first half assumed the 0% was vs. the 30%, but the later "to me" paragraph decided that the 0% was likely for the promotion, which meant that the entire comment was confusing and I realized I was just making things worse by posting it.
I imagine if Amazon had to reimburse developers for any non-zero amount this would be bad for business. It sounds like they're in this "free app a day" thing for the long-haul.
It also seems to me that what the developer is getting for this is a free day of advertising. So if someone tries your app who normally wouldn't have because it's prominently displayed on the top of the screen and they like it they might buy the next version or other apps from you.
The one piece of legitimate news here is that app of the day developers aren't being compensated at all, but that comes no where near justifying "rotten to the core", especially as they're all well aware of the terms when they agree to them.
He seems overly concerned with people who download the app just because they think it will trigger some micropayment to the developer, but that can't be a large number of people (developers paying attention to the launch terms of the market) and in any case are very unlikely to make up much of his support burden.