Amazon (AMZN) is jumping into the app game headfirst by launching its own app store for Google (GOOG) Android. Amazon definitely sees that we are shifting from a web-centric to an app-centric digital economy, but the company should get its virtual house in order before opening the store. Without some major housekeeping, Amazon is liable to lose its current grip on the digital book market while simultaneously getting crushed between app store juggernauts Apple (APPL) and Google.
My BNet colleague Erik Sherman bets in his Wired In column that the app store the first step towards an Amazon Google tablet. I love the theory, but there are some basic things Amazon has to straighten out before it can even think contemplate going up against Apple. For example:
Allow in-app Kindle purchases: It's a simple idea: Have customers download the Kindle app and, within the app, allow them to purchase books. It hasn't been done yet. While I previously praised Amazon for pushing Kindle as a platform instead of a device, it still hasn't streamlined the user experience.
Here is what a user does in the Kindle app:
- Launch the Kindle app
- Click on the book search icon
- Open the web browser and search for the book on the Amazon website
- Purchase the book
- Reopen the Kindle app
- Wait for the book to download
- Read the book
Fix the imbalanced best-seller list: As discussed in a previous BNet Gadget Watch post, video games apps are currently blocking best-selling Kindle books from getting the number one spot. It goes beyond ego, as I explained the difference between getting the number one or the number two position can affect book sales and even author royalties directly.
It is another easy solution for Amazon: Create a separate list for apps and books. There aren't many apps right now, of course, but at least it will stop readers from being insulted by video games being on their list and gamers from being confused as to why gamers are on the list in the first place.
The problem with Amazon's leap into the app world is that the issue of apps vs. books will accelerate quickly. Amazon has only one major app, Electronic Arts' (ERTS) Scrabble, and it's been hogging up the top Kindle paid books position for two weeks now, not to mention its two free word apps that have been doing the same on the free paid books list for literally months. Maybe it should learn how to properly organize three apps before deciding to launch a store.
Establish transparency with digital customers: This past Spring Amazon began publishing the most highlighted passages in Kindle books. While I compared Amazon's approach to an unauthorized search warrant, Gadget Watch readers considered it either a harmless rating system or an invasion of privacy.
It was one of the more lively debates had on this blog, but it didn't matter: Amazon still hasn't addressed any privacy concerns brought up by BNET or other critics. Regardless of where consumers stand, it is clear that Amazon will have to take on privacy issues much more aggressively in the app arena. Forget book passages; Amazon will have to deal with location check-ins, photos, personal vs. shared status updates, and the plethora of privacy headaches that Apple and Google, and, to a lesser extent, Facebook and other social networking appmakers have been dealing with for years. Suddenly throwing user information on its website, as it did with the highlighted passages earlier this year, isn't going to cut it when it comes to apps.
Amazon is doing great right now, with a high Kindle adoption rate, the largest paid digital book selection, and a multiplatform approach to ebooks. However, it seems premature -- if not completely unnecessary -- for Amazon to create its own app store, especially as its own digital efforts are far from flawless. It's not a time for expansion, but refinement.