
Amazon Coins Launching - weej
https://developer.amazon.com/sdk/coins/landing.html?ref_=pe_132830_29076940
======
buro9
So I'm trying to work out why?

And off the top of my head it's probably combination of:

1) Helps with micropayments for low value in-app purchases

2) Creates a disconnect between the real cost and perceived cost

The latter helps Amazon create an artificial incentive that they can use to
build their store. For example: Buy something physical off amazon.com and earn
100 free Amazon coins to spend on something digital (implicit: with Amazon).

~~~
draz
Dan Ariely mentions these types of products (albeit in the context of
cheating): the more removed the product is from real money, the easier it
becomes to justify all kinds of actions you normally wouldn't perform:
stealing it, spending it, etc.

~~~
rayiner
You can bet marketers are reading through his books looking for ways to hack
consumers.

~~~
fyi80
Or they are reading the same marketing textbooks he is reading.

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callmeed
From the FAQ:

>> _Q: Can customers use their Amazon Coins to buy in-game currencies?_

>> _Yes. Customers will be able to purchase in-game currencies with Amazon
Coins._

Good Lord, how many levels of fake money do we have to travel down?

~~~
lifeformed
...USD to buy Bitcoins to buy gift cards to buy Amazon coins to buy in-game
currency to buy in-game items to build up my virtual character which I sell on
ebay for USD to buy Bitcoins...

~~~
pettazz
This is what I heard in my head while reading your comment:
<http://www.youtube.com/watch?v=8FpCM5cWkNM>

------
Lightning
<https://news.ycombinator.com/item?id=5170855> and
<https://news.ycombinator.com/item?id=5174832>

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throwaway420
One big difference that Amazon has with other companies that try and lock
people in with virtual currencies - Amazon already has more credit cards on
file from customers that trust the service and willingly shop from there than
just about any other company in the world.

So I'm sure there's a reason for this, but just because of the sheer number of
credit cards they already have on file I'm having a hard time seeing a real
rational for this move.

Are they really trying to effectively trick gamers from buying useless game
add-ons by divorcing that from its actual monetary cost? Are they betting that
heavy hitters on Farmville type games will make this worth their while? That's
the only reason I can kind of come up with. If this is the real motive, I'm a
bit disappointed because I expect more from Amazon.

~~~
turtlebits
It's a marketing tool so they can give out promotional credit.

They've been doing it for years by giving out free MP3/Video credits
occasionally.

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Jtsummers
Is it correct to refer to this as a virtual currency? Isn't this just a sort
of prepaid debit system like MS and others use in their own markets?

~~~
dholowiski
They are just trying to cash in on that other *coin virtual currency that's
been in the news so much recently.

~~~
Jtsummers
As linked by Lightning this has been in the works for a while now. I don't
think bitcoin is their motivation. More likely it's as others pointed out,
they get to hold the cash and earn interest/dividends on investments with it
until customers spend it. And they can reduce transaction costs because
they're handling the transactions, not Paypal/CC/banks.

~~~
MacsHeadroom
>this has been in the works for a while now

How long is a while? Bitcoin is in its 5th year of being a thing.

~~~
Jtsummers
If this functioned similarly that'd be a fair statement. This is being called
a currency, but it's really the same as MS Points or any other similar prepaid
card. Amazon has the benefit of restricting where the outflow is and so can
also ensure 30% of what comes in to buy coins is profit[1], and then make
earnings off the rest. And given how constrained the outflow is this is hardly
a competitor to bitcoin or any other attempt at a virtual currency. It's a
lockin attempt and a play for earlier access to capital. It will probably be
successful on both fronts.

EDIT:

[1] Profit is the wrong word, there are other costs involved that will eat
away at that 30%. I should have said 30% was guaranteed revenue.

~~~
MacsHeadroom
I believe the argument was that the 'name' Amazon Coins is meant to capitalize
on things like Bitcoin, Litecoin, PPCoin, NameCoin, FreiCoin, DevCoin, etc.

The function is clearly something more similar to MS Points.

~~~
Jtsummers
I'm still unconvinced that Amazon has any need to try and take advantage of
their current popularity. They have sufficient capital and brand recognition
to develop this system without riding the coattails of a still (in mainstream)
largely not understood or recognized virtual currency.

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UnoriginalGuy
This move essentially splits Amazon off from the Play ecosystem. I mean they
already had their own store which people would "invest" in, but adding a
currency/gift cards/freebies will only increase the lockdown/isolation
further.

I'll leave it up to the reader to decide if this is a good or bad thing but
for me: I am skipping Amazon's ecosystem in the foreseeable future and
sticking to a more open alternative (namely the Play store, which works on
most Android devices - including Fire tablets).

~~~
fein
> including Fire tablets

With Amazon starting up with their own store, this may soon be a thing of the
past.

~~~
random42
Why would they do that in immediate future?

~~~
fein
I highly doubt they would, however as soon as their store gains traction, it
makes very little sense for Amazon to support a direct competitor on their own
branded devices.

I'm not saying its a good or bad thing; it's just how these vendors operate.
You don't have itunes on android devices, and you don't have the google play
app available on i-devices. You can still use the Play web app on any device,
of course.

~~~
NewAccnt
Technically, they don't support it. People have just figured out how to side-
load it and Amazon hasn't done anything to block it.

~~~
r00fus
Exactly. So perhaps Amazon might begin to block it in the future. I don't
really see that happening soon, however. Amazon hasn't built up enough
critical mass to ditch the larger Android ecosystem.

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seanalltogether
It weird that amazon would move in this direction to split up their customer
base onto different forms of currency.

Microsoft is rumored to be tearing down their XBox points system so that there
is less fragmentation in payment across their product lines.

~~~
jmduke
By far the most aggravating aspect of MS Points are that its not a 1:1
conversion rate. I don't think there's anything inherently 'bad' about an
internal payment currency (beyond the fact that consumers generally dislike
it.)

~~~
Livven
See, you're considering this from a US-centric view. There are lots of
currencies, so there's no single 1:1 conversion rate.

~~~
jmduke
Touche -- that's a good point.

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wtvanhest
This seems like a clear cut way to get developers to develop or port over
their current apps to Amazon's app store.

"Sign-up to be a developer for Kindle Fire and submit your apps by April 25th
to ensure we have time to review them before millions of dollars in Amazon
coins arrive in customers’ accounts."

The call to action basically says: We are flooding the market with free money
which developers are going to get 70% of.

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daigoba66
At least it's 1 coin = $0.01 USD. Far better than Microsofts "Points" where
it's I think 79 points = $0.99 USD. This makes it really hard to figure out
the actual cost of something listed, for example, 600 points. It also makes
things seem cheaper than they really are.

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hkmurakami
_> When Amazon Coins launches in May, we will give out tens of millions of
dollars in Amazon Coins to customers to spend on Kindle Fire apps, games, or
in-app items._

For a split second I thought, "is this a new way for Amazon to spend their
free cash flow to the point where their profits approach zero?" but then I
realized that this is only for digital purchases so they aren't actually
_spending money_ per se and the hit to their actual top line will be a small
fraction of the total giveaway (esp. since these coins can't be used on kindle
books it seems)

~~~
tjbiddle
If a consumer purchases something then wouldn't Amazon be losing 70% of that
as they have to pay the developer of the app the consumer made the purchase
on/for?

~~~
hayksaakian
given their history with paying developers that are the app of the day on
their store[1], I can see them finding a loophole to avoid paying devs who
collect payments with coins.

[1] [http://blog.shiftyjelly.com/2011/08/02/amazon-app-store-
rott...](http://blog.shiftyjelly.com/2011/08/02/amazon-app-store-rotten-to-
the-core/)

~~~
chrisrhoden
As of now, they are claiming they will be paying out exactly the same as if
your app was purchased with dollars.

It seems like that's a major part of this push - if you want to receive any of
these free Amazon dollars, submit to the app store.

<https://developer.amazon.com/help/faq.html#AmazonCoins>

~~~
hayksaakian
The point remains; I still have very little faith in Amazon's android
adventures given their shady history.

~~~
chrisrhoden
This is sort of a very different situation - whether or not you agree that
their offer to be featured as the free app of the day is valuable, they were
upfront that the rev-share in that situation is 0% when they make the offer.

In this situation they are claiming that it's exactly the same as cash to
developers - that is, you will receive 70% of the purchase price. I have
absolutely no reason to believe that they're attempting to mislead or be
dishonest.

------
obilgic
Are they trying to capitalize on current Bitcoin hype on the mainstream?

~~~
dmix
This isn't a crypto-currency, only a virtual currency with a single vendor.

Not quite a BTC competitor in any sense yet.

~~~
gnu8
It's not a currency at all, they're prepaid gift cards without the card.

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jibbist
How can a 'new virtual currency' be US residents only?

This is more akin to Disney Dollars, than it is to an actual currency which
has controls, an exchange rate, international trade etc.

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aseem
It seems like it's just a way for Amazon to avoid paying transaction fees on
real money. With their margins, this could make sense and be a worthwhile
endeavor.

------
smackfu
I can see Amazon using this kind of thing to differentiate better between
"real" credit and promotional credit. Like, if I have Prime, and I choose to
take a slower shipment time, I can get $1 for MP3 downloads. But that is not
the same as if I just had a $1 credit on my Amazon account... it's much less
useful. Amazon could make that $1 promotion be a 100 AZC, and it would be a
lot more clear.

------
DigitalSea
At first glance this appears to be a virtual currency along the likes of
Bitcoin but then you actually read what Amazon Coins actually is and it's
merely a points system along the likes Microsoft Points merely capitalising on
the whole Bitcoin virtual currency craze. The fact that it's US only for the
moment is another limiting factor, not really that impressive once you break
this thing down.

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antihero
How about fuck no? The whole point of bitcoin is that it's decentralised and
you _own_ your coins. This is basically just Zynga.

~~~
tantalor
This has nothing to do with Bitcoin, obviously.

~~~
antihero
It, like Bitcoin, is a virtual currency.

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lifeisstillgood
Dammit - I read this and thought it was branded bitcoins!

Which reminds me - is there any cryptographic reason this cannot be done ?

~~~
NewAccnt
There are all sorts of off-brand "bit-coins" already. Litecoins are hoisted on
certain forums quite regularly.

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dendory
The 'why' is the same reason Xbox points exist. Because it makes the company
more money than dealing with micro transactions. Amazon saw Bitcoin's success
and tried to use its popularity to name this a virtual currency. Except they
failed in the very first sentence, where they start with 'US only'.

~~~
jonknee
Coin has been used to describe currency for far longer than Bitcoin has been
around...

------
rdl
A US-only virtual currency to buy stuff from a single US merchant seems pretty
pointless. Why not just do the Apple trick and aggregate credit card
purchases?

Virtual currency sort of makes sense for marginalized communities (unbanked,
children, illegals, etc.), but really only makes sense for international.

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lucb1e
If I never heard of Amazon before and then saw this page, I'd think it was a
scam without ever looking back. It looks like another Get Rich Quick-scheme
with the obvious gold "Tens of millions of dollars" as first words on the
page. That text color also has a goldish tint.

------
tomelders
Um.... Amazon Vouchers then.

What an vacuous way to market them. I'm having a hard time believing this is
anything other than an attempt to hitch a ride on bitcoin's wagon, aimed at
exploiting the little bits of info that the uninformed know and/or have heard
about "digital coins".

------
owenfi
It seems like an attempt to convert developers from Play to Amazon Appstore.
The $10M seed money will encourage a land rush (or at least they hope).

If it doesn't work out it will be easy enough to phase out the program by
converting bought coins back to a store-credit.

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smoyer
"... a new virtual currency ..."

It doesn't seem that way to me. It's more like a bus token since you can only
spend it in certain venues. Or a coupon if you can redeem it for cash. At
best, it's a virtual bank account.

~~~
T-hawk
Bus tokens and coupons are also virtual currencies. As a merchant, you're free
to accept payment in bus tokens, if you like.
<http://en.wikipedia.org/wiki/Scrip>

Every currency or instrument of value can only be spent in certain venues. Try
spending USD in a small French village, for example.

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blakeshall
So XBOX is to Kindle Fire as Microsoft Points are to Amazon Coins?

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iguana
I wonder if they'll let you transfer coins to other people easily.

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buss
I wonder if one has to pay sales taxes on amazon coins. If not, then they have
a successful way around that little nuisance.

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reddit_clone
>You will get paid the same 70% revenue share

Guess it sounds better than 'We will take a 30% cut of everything you sell!'

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IvyMike
What's the exchange rate with Flooz?

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gailees
Amazon is killing it. Any chance they'll become a direct competitor to bitcoin
anytime soon!?

~~~
NewAccnt
no.

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ricardobeat
Those coin renderings look a lot like Bitcoin. Thanks for adding to the
confusion, Amazon.

~~~
tspiteri
Those coin renderings look a lot like coins.

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jbarham
Makes me nostalgic for Canadian Tire money...

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tyang
Brilliant. Is this goodbye for BitCoins?

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felipelalli
Bitcoin envy.

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ttrreeww
Is this the successor to BitCoins?

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tommoor
I read "Amazing Coins Launching"

Sorry this comment adds no value ;-)

