Amazon Appstore reduces revenue cut for small businesses
Developer and app store cuts have been around for ages and, while there have been some voices of opposition, the current 70/30 split has more or less been accepted as a fact of app store life. Epic Games may be credited for kicking the hornet’s nest, putting this system under a microscope and setting off a chain of events that eventually did lead to changes beneficial to developers. After Apple and Google announced changes, Amazon is following suit with its Amazon Appstore Small Business Accelerator Program that gives developers a larger chunk of their revenue along with some AWS credits.
Unless you’re knee-deep into Amazon’s ecosystem, you might not be aware that it also has its own Appstore for Android apps. And as with any app store, it takes a cut from the money that developers make on its Fire tablets. In the past, Amazon played by the same 70/30 cut, giving developers 70% of the profits while keeping 30% for itself. Now it will be shaking things up a bit in an arrangement that gives smaller businesses even more than what other app stores offer.
Upfront, Amazon will be changing the split from 70/30 to 80/20, meaning that it will only take away 20% of the revenue. That doesn’t look better than what Apple and Google will be implementing next month. Both will start taking only 15% cuts for developers that make less than $1 million a year or, in Google’s case, for the first $1 million in revenue.
Amazon, however, is also throwing in an AWS promotional credit that is equivalent to 10% of that revenue. This practically means that developers will be taking away an equivalent of 90% of revenue, presuming they actually spend a lot on AWS in the first place.
As the name implies, the Amazon Appstore Small Business Accelerator Program really only applies to small businesses, here defined as developers that made less than $1 million in the previous calendar year. Developers should also note that the 10% AWS credit option expires 12 months after they were granted if they want to make sure they get the full 90% profits from Amazon’s new program.