I’ve posted some thoughts about Amazon’s upcoming Android Appstore over at the Rectangular Blog. There has been a lot of discussion about Amazon requiring control over app pricing, most of it focusing on the potential negatives for developers. However, one thing that has been overlooked is that if Amazon decides to give your app away for free it might actually be the most lucrative way for your app to be distributed:

The developer will be paid 70% of the purchase price of the app, or 20% of the list price, whichever is greater.

The important thing about this last point is that the developer gets paid even if the app is given away for free. At first glance, having your paid app given away for free and only getting 20% of the list price for each user, rather than 70%, seems like a bad deal but in reality it could be lucrative for the developer. On the Android Market, free apps typically get somewhere in the region of 50 times as many downloads as paid apps. If that ratio translates to Amazon’s store then instead of selling 200 copies at $2 and getting $280 out of it, the same developer could see 10,000 copies given away free and yet earn $4,000.

Not everyone will be a winner, but with Amazon’s other obvious advantages, this new store could potentially be the first alternative marketplace to seriously challenge Google’s Android Market.

From http://blog.uncommons.org/2011/03/09/thoughts-on-amazons-android-app-store