Amazon dumps $20 pricing limit on Android in-app purchases

Amazon is eliminating restrictions limiting developers from charging more than $20 for premium digital content and subscriptions sold within applications and games available via the Amazon Appstore for Android.

"With our parental controls functionality now updated, in-app items over $20 may now be submitted via the developer portal," reads an email sent by Amazon to Android developers and obtained by TechCrunch. Appstore for Android in-app purchases leverage Amazon's signature 1-Click purchase technology to simplify and secure the checkout process; all purchases require an Amazon password or a four-digit PIN as safeguards against unauthorized purchases.

Amazon unveiled its In-App Purchasing service last week. The platform supports the sale of virtual goods such as in-game currency and expansion packs as well as individual issues of periodicals. Amazon Appstore for Android limits in-app sales to digital products, content and services designed for use within the app. Amazon claims a 30 percent cut of all sales enabled by the In-App Purchasing service, the same percentage it takes on downloads of premium-priced applications.

Amazon's pricing limit policy change is significant for developers because transactions eclipsing the $20 benchmark generate 51 percent of in-app mobile game revenues, according to data issued in mid-2011 by mobile app analytics firm Flurry. "Further breaking down the 'over $20' category, 30 percent of the total revenue is generated from transaction sizes of over $50," stated Flurry Games GM Jeferson Valdares. Flurry added that 13 percent of all iOS and Android in-app transactions surpass the $20 mark.

Developers also generate substantially greater revenues per user in Amazon Appstore for Android than in the rival Google Play storefront, according to more recent Flurry data. For every $1 generated by Apple's (NASDAQ:AAPL) pacesetting App Store for iOS, Amazon Appstore yields an average of $0.89 per user, and Google (NASDAQ:GOOG) Play earns developers just $0.23 per user, Flurry reports. It credits Amazon Appstore's success to the company's digital retail expertise, noting that Google's strengths are its search tools and advertising technologies.

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