Microsoft’s Windows Store revealed: Flexible pricing, and potential for 80% revenue split

December 7, 2011
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Named the Windows Store, this marketplace embraces the Win8 “Metro” interface that has been previously demonstrated, and builds upon contemporary app store experiences with flexible billing that will appeal to content publishers and a revenue sharing model that gives developers increased profits after their app makes $25,000.

After declaring that this would be “the biggest and most significant development opportunity ever,” Microsoft VP of Windows Services Antoine Leblond walked attendees through the Windows Store experience. Not surprisingly, developers will be able to utilize the Metro interface in building out their apps’ storefronts. This includes the ability to customize color schemes, add screenshots, and offer try-and-buy functionality.

In a manner similar to Apple and Android’s marketplaces, Microsoft’s content team will curate apps by creating best-of lists and by-category filters of apps. The Windows store will also create personalized recommendations based on consumer’s preferences and purchases.

Leblond stated that all apps in the Windows Store, whether HTML5/Javascript or C-based, will work across multiple platforms of Windows 8. He did not state, however, whether a single purchase of an app will allow access across all platforms and devices. Given the flexibility the company is giving app developers, it is highly likely that this will be determinable by the developers themselves.

Developers: Charge what you want, but no $0.99 apps

Perhaps the most intriguing aspect of the Windows Store—particularly for content publishers and app developers who have existing billing/subscriber models—is that Microsoft says it will offer developers flexibility around billing. “We’ve witnessed the struggles of publishers and digital content, and the frustration of Apple standing between you and customers, Leblond said, citing the example of Match.com getting kicked of Apple’s App Store because it had a link to its subscription web site in its app.

To remedy this (and to encourage developer support), Microsoft will allow multiple means of billing and transaction support. This includes native in-app purchases and upgrades to native support for external subscriptions. The demonstration included a Metro-style app created by The Daily Telegraph, where you could access gated premium content by logging in as an existing subscriber, or by creating a new subscription; all transactions will theoretically be handled on The Daily Telegraph’s side.

The company also showed off an eBay app where purchasing transactions were handled by PayPal.

The Windows Stores pricing scheme sets itself apart from others by constricting app prices to a range between $1.49 and $999.99.

While the standard revenue split is 70/30, just like Apple’s and Android’s model, Microsoft is offering an added incentive for developers with a progressive element that will allow developers to make 80% of the total profits in perpetuity if/when their apps go past $25,000 in total sales.

Developer support

On the developer support side, Microsoft’s Leblond stated that the company’s goal is transparency around app submission and approval.

To wit, the company will offer downloadable tools that mirror the technical checks it will use to approve apps. This will allow developers to check the stability of their apps prior to submission.

The company will also offer clear guidelines (which have not been defined yet), as well as a dashboard that will indicate at what point in the development process an app is.

1.25 billion Windows users

Microsoft cited the 1.25 billion Windows PCs in operation today, the 500 million Windows 7 licenses, and industry forecasts that 400 million new PCS will be sold in the next 12 months as proof that even though its app store will debut more than two years after Apple’s and Android’s.

In response to naysayers who have criticized Windows’ installed base as consisting of a great number of professional and enterprise users, the company also demonstrated the same Metro UI interface in action in two different enterprise-oriented apps – a claims adjusting app and an expense report accounting app. Both plugged into back-end databases, and both used Windows Metro UI functions such as pop-up notifications and live tiles.

Microsoft also displayed the same apps with the same data co-existing on a tablet device that could theoretically be provisioned for home and personal use using Windows’ native network and device management features.

Left unsaid is whether or not these same apps will work on Windows Phones or Xbox 360 console gaming systems.

The Windows Store will debut in beta form along with the Windows 8 beta towards the end of February 2012. The store will only feature free apps, and developer submissions will be by invite only.

To spur app development, Microsoft also announced its first apps contest. Developers are encouraged to submit their apps, and the top 8 will be featured first in the app store upon the release of Windows 8 later in 2012. Contest rules and submission guidelines for the contest can be found at http://buildwindowscontest.com.

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