Amazon AppStore follows Google and Apple in reducing its commission cut for developers making less than $1 Million, and throws in AWS credits

Amazon Appstore Small Business Accelerator Program
Small Business Accelerator Program comes to Amazon AppStore. Pic credit: dronepicr/Flickr/CC BY 2.0

Amazon AppStore commission, just like Apple Tax and Google’s Android Play Store, is 30 percent. Now the retail giant has indicated it will take a lower amount from developers.

Amazon has announced a new “Amazon Appstore Small Business Accelerator Program” which should encourage more developers to its Android and Fire OS app store. In addition to charging a lower commission, Amazon will also offer AWS (Amazon Web Services) credits.

Amazon AppStore for Android and Fire OS will take a 20 percent cut but offer AWS credits:

Amazon Appstore Small Business Accelerator Program will soon come into effect. It could get up-and-coming developers to take up app development for Amazon’s Android and Fire OS app store.

The new program will reduce the commission Amazon takes on app developers’ revenues. The program is valid for smaller businesses that fulfill certain criteria.

Just like the industry standard, Amazon too took a 30 percent cut from app developers. Not just every sale of a paid app or service but even in-app purchases were subject to the Amazon Tax.

Moving ahead, Amazon will take a 20 percent cut from developers. To qualify for the reduced cut, developers must have earned less than $1 million in the prior calendar year. It is important to note that Google and Apple had reduced their commissions for smaller businesses from 30 to 15 percent.

Amazon, on the other hand, will charge a 20 percent commission. However, it will give developers an additional 10 percent in “AWS promotional credits.”

Technically speaking, if an app developer is using Amazon’s popular AWS cloud services, they could qualify to keep 90 percent of the money earned through the Amazon AppStore. This is also a clever technique to coax developers into using Amazon AWS instead of Google Cloud, Microsoft Azure, etc.

Do developers actually benefit from the Small Business Accelerator Program?

It is important to note that the Amazon Appstore Small Business Accelerator Program is a “program”. This means, not every developer or company will qualify to keep a larger portion of revenue.

Additionally, just like Apple and Google, developers could automatically exit from the program or disqualify once their revenue rises beyond $1 Million.

Still, if a developer shifts to AWS, they have the opportunity to effectively retain 90 percent of their revenue by utilizing the AWS credits. AWS services include infrastructure technologies like compute, storage and databases — to emerging technologies, such as machine learning and artificial intelligence, data lakes and analytics, and Internet of Things, claimed Amazon.

Such benefits from tech giants are arriving right at the time they are under increasing regulatory pressure over the nature of their businesses. Several smaller and even larger app publishers claim Apple, Google (and perhaps even Amazon) are anti-competitive and monopolistic.

Presumably sensing growing trouble, Apple and Google lowered fees for smaller businesses as a gesture of goodwill. Needless to mention, the reduction for a few qualifying small businesses won’t make any major dent in the companies’ revenues from app stores.

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