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Fatal flaw in Amazon's Kindle developer program

Amazon wants to compete with Apple's App Store, but its burdened approach to developers is hopelessly flawed and needs to beat Apple in openness or it's DOA.

Few will have noticed that is getting into the developer game for its Kindle e-reader.

It doesn't help that Amazon is launching its third-party developer program in the midst of Apple's tablet hoopla, but that's not the core problem.

The big problem is that Amazon's program offers developers less than Apple's equivalent. A lot less. And it's way too late, as ZDNet's Jason Perlow opines.

We are presently inundated with application stores. Every device seems to come with its own app store these days--each an island within the larger ocean of mobile computing.

Amazon might have been able to stand out when it first introduced the Kindle, but today there are application stores for everything from iPhones to Nokia phones to BlackBerrys to Intel-based Netbooks get the picture.

To stand out, the Kindle developer program needs to offer developers more, much more, than they'll get with competing application development platforms and associated application stores. In this Amazon strikes out. Big time.

As reported by The New York Times, the Kindle program requires developers to pay 15 cents per megabyte for wireless delivery of their applications to end-users.

This requirement doesn't apply to free applications, as noted on Amazon's Kindle developer page, but it could be a healthy chunk of a 99-cent application, when Amazon is then going to take another 30 percent of the net on the deal.

And will Amazon stick to this arrangement? The vast majority of applications (80 percent) distributed for the iPhone cost users $0, which means that Amazon is going to be paying for a lot of wireless distribution.

It can afford to do so now, but what about when developers get paid for in-application advertising, rather than the application itself?

Gartner predicts that by 2013, 25 percent of app store sales will come from advertising on free applications. Will Amazon tweak its program to take a fee on the advertisements? Or will it push the 15-cent delivery charge onto these free applications, anticipating that the developers will get paid?

In this scenario, it might be that developers will underwrite delivery charges to get to downstream advertising revenue, but that's a risk many developers likely can't afford to take.

Amazon might be able to overcome this hurdle it offered a significantly more open development platform (and approval process) than Apple, but it doesn't appear to be doing so. As Fast Company notes:

The [Apple] App Store's true rival isn't a competing app marketplace. Rather, it's the open, developer-friendly Web.

To the extent that Amazon can open the Kindle to that developer ecosystem and shoulder the costs of application delivery, it could have a winner on its hands. But so long as Amazon simply apes Apple's somewhat closed approach, while potentially burdening developers with the cost of reaching their audience, it will fail.