A recent Wired report describes the way Amazon is attempting to disrupt the software environment through Amazon Underground, a new model that’s grown exponentially since launching a few months ago.
For those unfamiliar with Underground—which, realistically, includes most people—the model is incredibly simple, especially for customers. Simply download a game, usually one that costs at least a dollar or two on other platforms, and play for free. There’s no up-front cost, and no in-app upsell. Amazon pays developers, meanwhile, based on how much time people spend using the apps.
A Familiar Model
That’s exactly what Amazon is already doing with Kindle Unlimited: turning a purchase model into a subscription one. People used to buy books; now they can read them for free. Authors get paid according to how many pages they read.
In retrospect, it makes perfect sense. The company obviously aims at turning itself into a one-stop-entertainment-center, combining video, books and games. It will all be paid through subscriptions.
Will it work?
But how successful is their new endeavor?
As with its hardware sales, the numbers Amazon shares aren’t absolute. Instead, they’re percentages, so it’s impossible to say exactly how Underground sizes up next to Google Play and the App Store (hint: Still very, very small!). The growth has been significant, though.
Some numbers will help put this into perspective:
- Royalties paid to developers are up 3,600 percent since Amazon Underground launched in August.
- Royalties paid to developers grew 50 percent from December to January alone.
- The number of developers on the platform has more than tripled since launch.
- The customer base has grown 870 percent.
You can attribute much of that growth to the popularity of Amazon Fire tablets, which come with Underground pre-loaded.
You can also, though, attribute it to a system that benefits customers and developers equally. In-app purchases, after all, often are a scourge for both. While no one wants to stop to shell out a few bucks to advance a level, developers are also often loathe to interrupt fluid gameplay to ask for those shekels. It’s just been the best way to turn a profit. Or was, it turns out, until Amazon Underground.
Goat Simulator has been downloaded over 500,000 times in the Google Play Store, at $5 a pop. Variations like Goat Simulator MMO Simulator and Goat Simulator GoatZ have each been downloaded over 50,000 times each, also for five dollars. The iOS App Store doesn’t offer specific download numbers, but the original Goat Simulator remains a top-30 paid app. The goat, it turns out, is a cash cow.
The Goat Simulator you’ll find on Amazon Underground is the same as its iOS and Android counterparts, with one key distinction. Instead of a five dollar cover charge, you can play it for free.
The game’s developer, Coffee Stain Studios CEO Anton Westbergh, says, explains that the initial numbers weren’t especially impressive. But an influx of Fire tablet owners around the holidays resulted in a “huge spike” in daily downloads and new users.
Like Amazon, Westbergh also declined to provide hard numbers. The developer does say, though, that Goat Simulator revenue on Underground has outperformed its Google Play version by as much as 30 percent. That’s especially impressive when you remember that it’s comparing a five dollar app to a model that pays Coffee Stain Studios $.002 per minute of engaged user time.
“Once Underground can prove that an average game can do at least as well as on other platforms, I think that’s the turning point,” says Westbergh.
At this rate, it shouldn’t be long at all.