News

Amazon Appstore Adds In-App Purchasing API

• By Keith Ward
• April 12, 2012

The Amazon third-party developer community, which has been growing quickly through the success of the Kindle Fire, is likely to pick up even more steam with its announcement of  the In-App Purchasing API.

The new API allows developers to increase profits through upgrades within the application. Such upgrades often take the form of currency for certain games, expansion packs and enhanced functionality over free versions.

The Amazon Appstore is a major component of the Kindle Fire, and is also available on other Android-based devices. Amazon, on its developer blog, pointed out the potential market for the in-app upgrades. "With the Amazon Appstore for Android In-App Purchasing solution, you can reach customers with existing accounts who have already bought apps, including millions of Kindle Fire customers."

In-app purchases are available through Amazon's one-click system as well as more traditional methods. Amazon's cut of each in-app upgrade is 30 percent, comparable to the main competition, Apple's App Store and Google's Google Play (the former Android Market).

The addition of in-app purchasing further levels the playing field between the three major players in the mobile app space, as both the App Store and Google Play have offered in-app purchases for some time. But even though both of those stores have been around longer and offer more overall apps, the revenue generated by those apps shows that Amazon's Appstore is significantly more lucrative than Google Play, according to mobile market researcher Flurry. And it trails Apple's store by only a bit.

Flurry says those numbers shouldn't be a surprise, considering Amazon's history as a retailer, vs. Google's traditional strengths as a search and advertising company.

There's a possible cloud on the horizon, involving patent infringement. Patent-holding company Lodsys has previously sued both Apple and Android developers for what it claims are infringement of its patents. The patents have all had to do with in-app purchasing. CNET is reporting that Lodsys is looking in Amazon's direction. According to a statement Lodsys sent CNET:

"Amazon is not licensed ... Lodsys Group LLC will continue to seek license agreements from companies that are infringing the claims in its portfolio."

Apple, for its part, has strongly backed its developers in the dispute with Lodsys.