Wow..Amazon gets to set the price on your app. Developers only get to recommend. Certainly original. If this takes off it could have a significant impact on application pricing for more than just Android devices. iTunes put it in people's heads that a song is worth $1. Amazon is working hard at saying that a book is worth $10. This is the same model - by setting the price for individual apps, Amazon is going to be se…
"Amazon gets to set the price on your app. Developers only get to recommend. Certainly original." This is how the vast majority of retail products work. The manufacturer suggests a retail price, but it is up to the retailer to determine what the consumer ultimately pays. Software was sold this way for several decades. So it strikes me as more "retro" than "original". Not that it's a bad thing -- I love the idea of Am…
This is quite different because in retail the wholesale cost is negotiated between the manufacturer and retailer. Therefore, the price that the retailer chooses to sell the product at to consumers does not change how much the manufacturer makes (except indirectly, by affecting quantity sold and therefore bought from the manufacturer). Coca Cola gets the same amount of money per can if Walmart sells the cans for 20 cents each or $2 each.
In this case, Amazon essentially gets to choose not only the retail price, but the wholesale price, except that the prices are at a fixed ratio to one another and there is a price floor on the wholesale price based on the suggested retail price you gave.