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IGDA attacks Amazon Appstore terms

Retailer accused of using "content as a weapon with which to capture marketshare"

The International Game Developers Association has posted an open letter on its official blog criticising the terms for Amazon's new Android Appstore and warning developers of the precedent that it sets.

Signed by "The IGDA Board of Directors", the letter cites "significant concerns about Amazon's current Appstore distribution terms and the negative impact they may have on the game development community".

Speaking directly to developers, the IGDA warns that Amazon reserves the right to control the pricing of games - as well as the right to pay "the greater of 70% of the purchase price or 20% of the List Price."

Amazon has expressed zero willingness to adjust its distribution terms.

Open letter from the IGDA

"We are not aware of any other retailer having a formal policy of paying a supplier just 20% of the supplier's minimum list price without the supplier's permission," says the letter.

The IGDA is also concerned that Amazon reserves the right to cut the price of any game which is sold on other services. Even a temporary price promotion on another service will result in a lower list price in Amazon's Appstore, according to the IGDA's reading of the terms and conditions.

The open letter goes onto identify five "potentially problematic scenarios"

  • 1. Amazon suddenly creating steep discounts for a significant proportion of its catalogue.
  • 2. Being forced to choose between Amazon and other markets over promotions.
  • 3. Creating a precedent for terms that will make minimum list prices irrelevant.
  • 4. Steep discounts for niche products that significantly reduce a product's revenue potential.
  • 5. Discounting of hit titles when they are already selling well at a higher price.

In summary the IGDA claims that, "under Amazon's current terms, Amazon has little incentive not to use a developer's content as a weapon with which to capture marketshare from competing app stores".

The IGDA has already been in contact with Amazon but claims that the company has "expressed zero willingness to adjust its distribution terms". Nevertheless, the IGDA is insisting that developer's permission should be required before any retailer seeks to pay less than the standard percentage of a developer's minimum list price.

It also argued that developers should have the freedom to set a minimum list price of whatever amount they see fit, without regard to pricing in other app stores.

"We respect Amazon's right to stay the course, but as part of our mission to educate developers, we feel that it is imperative to inform the community of the significant potential downside to Amazon's current Appstore terms," ends the letter. "If you feel similarly, we urge you to communicate your feelings on this matter directly with Amazon."

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Latest comments (5)

Patrick Frost QA Project Monitor 6 years ago
That is quite a bad situation waiting to happen there. Do developers have to sign up with Amazon particularly to list their games or is it done through other parties?
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Tom Keresztes Programmer 6 years ago
There is a reason why no one repeated the success of the iTunes (both the media and software parts) - mostly because they came up with unacceptable terms. Just check the fees originally associated with Ovi store, for example. Its higher than the budget for most ($1) mobile games.
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Thomas Eidson Senior System Designer, Heatwave Interactive, Inc.6 years ago
I've just stuck with Android's market for apps I've written. I was considering Amazon, but this is quite an eye-opener. Thanks, IGDA!
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Matthew Hill Head of Recruitment, Specialmove6 years ago
Amazon excel in marketing, indeed their customer knowledge is so deep they have (still do ?) sell limited customer analytics data to their suppliers. Regardless I would struggle to sign up to these terms as a developer.
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Curt Sampson Sofware Developer 6 years ago
This is remarkably similar to the play Amazon made in the e-book market. You can read up on that to see what happened....
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