Amazon Announces a New Currency
Online retail giant Amazon announced Thursday that they will give away "tens of millions of dollars" in virtual coins in an attempt to spur app development for their Kindle tablet, according to PC Magazine.
The new currency, which is expected to launch in May, can be bought though an Amazon account. One coin will be worth one cent, and they can be used to buy apps or make in-app purchases on the Kindle Fire.
By giving away a large sum of coins, Amazon is hoping to drive app purchases and encourage developers to create applications for the Kindle tablet. Developers will maintain the standard 70 percent revenue share they recieve on traditional purchases, CNET reported.
"Amazon Coins is an easy way for Kindle Fire customers to spend money on developers' apps in the Amazon Appstore, offering app and game developers another substantial opportunity to drive traffic, downloads and increase monetization even further," the company said in a statement.
Amazon is not the first company to launch its own online currency. Facebook issued credits in 2009 to allow in-app purchases but did away with the program in 2012. Online game site Zynga did scrapped their ZCoins last year, as well.
Lars Perner, a marketing and consumer behavior expert at the University of Southern California, wondered whether the coins are a good fit for Amazon.
"It sounds a bit strange," Perner said. "It's not really clear why you would need a separate currency."
The online coins have been criticized because they will only purchase apps. But a succesful launch could extend the currency's purchasing power to e-books, music and the rest of Amazon's retail empire, according to Slate.
