Amazon Appstore Is a Bum Deal for Developers, Says App Company

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Russell Ivanovic runs a small mobile-app company called Shifty Jelly, which makes a pod-casting program called Pocket Casts. The app enjoys favorable reviews on the Apple Store and is quite popular in Ivanovic's home country of Australia.

Until recently Ivanovic also had his app on the Amazon Appstore. That was, however, until they agreed to a certain Amazon promotion. Now the business owner has pulled his product from Amazon's store and is warning other developers that they should consider doing the same.

Seattle Weekly spoke via Skype with Ivanovic in Australia last night (or this afternoon, Aussie time) and he laid out a story that he'd originally blogged about and has since gone viral (at least viral among the mobile-app-developing crowd).

Amazon runs a promotion on its Appstore called Free App of the Day, where the company offers a normally non-free app at no charge as a way of promoting it. The only catch: The developer earns no money whatsoever from sales while it's free.

Ivanovic says he and his business partner argued over whether the deal was worth it, then finally decided to give it a shot. "We wanted to try and experiment," Ivanovic explains. "We thought 'Well, Amazon knows how to sell its apps, maybe the exposure will pay off.'"

Ivanovic was both right and wrong. It turned out that the Free App of the Day Promotion was a hit. In that single day Shifty Jelly went from selling about 20 apps per day to selling 101,491 in 24 hours.

Under normal circumstances those sales would have brought the small company nearly $55,000.

But they got nothing.

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Sales from the days up to running Amazon's Free App promotion.
"That's not why were upset," Ivanovic says. "We're angry because the promotion was supposed to improve sales afterward. That never happened."

After the deal went down, Pocket Casts sales returned instantly to its dismal sales rate, Ivanovic says. And shortly afterward, the app Amazon downgraded Pocket Casts from $1.99 to $.99.

Interestingly, despite the post-sale slump (back to about 20 per day), Ivanovic says his app was consistently listed as one of the top sellers by Amazon, giving the impression that very few sales are made on the Appstore, period.

Not long after the sales dried up, Ivanovic pulled the plug and took his product off the store in disgust.

His beef, he says, isn't that he got slipped a deal he didn't sign up for. It's that the deal he did sign up for is a shitty one. "I felt it's all about trying to put free apps up and promote their store," he says of Amazon. "I wonder if they're doing that at the express of the developers themselves."

Since posting the story on his blog, Ivanovic says he's heard from several other app makers who feel the same way, like this one, who took his app off the store and is offering refunds to anyone who bought it through Amazon.

It should be noted that Amazon is the only major app carrier to offer the kind of free promotion it does. Both the Apple App Store and Google's Android Market keep the payout ratios the same for developers regardless of promotions (if they ever run them at all).

Amazon didn't immediately respond to a request for comment.

Ivanovic says the Free App of the Day promotion might work for certain apps where brief exposure is all they need.

But his advice for the average developer who wants some return on their investment is "stick with Apple or Google."

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