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Amazon Underground, a New Kind of App Store, Is Blowin’ Up

9 March 2016

From Wired:

The way developers sell apps has changed. It’s no longer as simple as in-app payments, or a premium price to download. What comes next, though, is anything but settled. One promising path is Amazon Underground, a new model that’s grown exponentially since launching a few months ago.

For those unfamiliar with Underground—which, realistically, includes most people—the model is incredibly simple, especially for customers. Simply download a game, usually one that costs at least a dollar or two on other platforms, and play for free. There’s no up-front cost, and no in-app upsell. Amazon pays developers, meanwhile, based on how much time people spend using the apps.

But how much do they pay? And how much time do people really spend in them? Amazon has shed some light on Underground, and how quickly it has grown in a challenging climate. As with its hardware sales, the numbers Amazon shares aren’t absolute. Instead, they’re percentages, so it’s impossible to say exactly how Underground sizes up next to Google Play and the App Store. (Hint: Still very, very small!). The growth has been significant, though.

Royalties paid to developers are up 3,600 percent since Amazon Underground launched in August. They grew 50 percent from December to January alone. The number of developers on the platform has more than tripled since launch, and the customer base has grown 870 percent.

You can attribute much of that growth to the popularity of Amazon Fire tablets, which come with Underground pre-loaded.

. . . .

You can also, though, attribute it to a system that benefits customers and developers equally. In-app purchases, after all, often are a scourge for both. While no one wants to stop to shell out a few bucks to advance a level, developers are also often loathe to interrupt fluid gameplay to ask for those shekels. It’s just been the best way to turn a profit. Or was, it turns out, until Amazon Underground.

. . . .

Goat Simulator has been downloaded over 500,000 times in the Google Play Store, at $5 a pop. Variations like Goat Simulator MMO Simulator and Goat Simulator GoatZ have each been downloaded over 50,000 times each, also for five dollars. The iOS App Store doesn’t offer specific download numbers, but the original Goat Simulator remains a top-30 paid app. The goat, it turns out, is a cash cow.

The Goat Simulator you’ll find on Amazon Underground is the same as its iOS and Android counterparts, with one key distinction. Instead of a five dollar cover charge, you can play it for free.

That might seem like an odd move for an app that had already seen remarkable success with the transitional paid model. And at first, Coffee Stain Studios CEO Anton Westbergh wouldn’t necessarily have disagreed.

“The gaming industry is changing so fast, you never know what’s going to be the next big thing,” says Westbergh. “Our strategy is basically to try new things as they pop up.”

The initial response, Westbergh says, wasn’t especially impressive. But an influx of Fire tablet owners around the holidays resulted in a “huge spike” in daily downloads and new users.

Like Amazon, Westbergh also declined to provide hard numbers. The developer does say, though, that Goat Simulator revenue on Underground has outperformed its Google Play version by as much as 30 percent. That’s especially impressive when you remember that it’s comparing a five dollar app to a model that pays Coffee Stain Studios $.002 per minute of engaged user time.

Link to the rest at Wired


5 Comments to “Amazon Underground, a New Kind of App Store, Is Blowin’ Up”

  1. So it’s sort of like KU for apps. I have a Kindle Fire and have some apps from Kindle Underground. I don’t play many games, but I did find some apps for children’s books that I use with my grandson.

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