If Amazon.com were a country, its revenue would make it the 80th largest GDP in the world, and now it has its own currency. Recently, Kindle Fire owners got a free deposit of 500 Amazon Coins to start their dual citizenship.
Are Amazon Coins a virtual currency like Bitcoin?
Will people abandon the US dollar in favor of Amazon’s legal tender of the United States? Do not; the deployment of Amazon Coins is so for “thousands of apps, games, and items within the Kindle Fire app on Amazon.com or on your Kindle Fire,” not books or movies. And while purchased Coins never expire, promotional Coins received for free or as part of another offer only last one year. Meanwhile, the average shelf life of an electronic device these days is shorter than Napoleon ducking under a pygmy goat. For now though, if you ditch the Fire for an iPad, Amazon can keep your coins in its jar.
Unlike Bitcoin, the preferred method of anonymous transactions for drug deals and rare earth magnets frowned upon by the Consumer Product Safety Commission, there is no open exchange for Amazon Coins. In fact, Amazon says: “Coins may not be resold, transferred for value, redeemed for cash, or applied to any other account, except as required by law.” Even Second Life Linden dollars can be exchanged for Bitcoins and then exchanged back for cash at one of several Bitcoin exchanges.
Amazon is selling its coins at a discount: 500 coins for $4.80 up to 10,000 coins for $90.00, and it looks like a good deal. With a discount of up to 10%, it’s like avoiding the Internet sales tax that may be implemented in the future if Congress has its way. Contrast this with Microsoft, which also uses a points system on the Xbox Marketplace, but only awards 80 points per dollar. If it’s Microsoft, it gives or sells points to buy apps and games, as well as increasing consumers’ wallet share of other products, like Skype calls, on which points can be spent.
It’s all about the app
Google, Apple, and Microsoft have their own app distribution systems, and Amazon already has its Kindle hardware platform, so why not? Amazon wants to expand its share of the tablet market while pushing e-books and gaming merchandise, but it needs more apps to be developed, so like Microsoft’s Xbox Marketplace points system, Amazon coins they serve to incentivize developers to offer Fire versions and share the revenue, soften the impact of the shopping tag, as well as lure consumers into other deals, like Amazon’s rumored set-top box.
Said one reviewer on Amazon: “I don’t see this coin thing as a good thing AT ALL. Not only does it hide the true cost of any content or item being sold, it doesn’t protect your account balance if any portable device is taken by an unauthorized user.” with 1 click enabled”.
1 click, by the way, is the only way to buy Amazon Coins. There is no option to add to cart and think about it, and the coins are non-refundable. As far as hiding the real cost, it’s true. 10,000 points is easier to spend than $90.00US, because it’s not real money, right? In that case, I’d like to share my Amazon wish list with you, because my birthday is coming up, and it’s just points after all.
