Here’s Why Amazon is Giving Away Tons of Free Apps

Amazon won plaudits yesterday when it launched Underground, a new Android app that, in addition to functioning like the normal Amazon shopping app, also promises users the ability to download "over ten thousand dollars in apps, games, and in-app items that are actually free." (Emphasis Amazon's.) Apps that would normally cost real money, or that would normally include optional in-app purchases, are now totally gratis for end users.

Of course, developers aren't merely giving away their apps just to become friends with Jeff Bezos. Instead, Amazon is paying these developers a fee of around one penny per five minutes of app use as recompense for giving away their wares via the Underground app. (All apps downloaded via Underground are tracked, with usage data being sent back to the Amazon mothership for analysis.) Amazon will also occasionally pop up an ad, Kindle special offers style, before the app starts.

You might be wondering why Amazon is keen to pay a whole host of developers "over ten thousand dollars" just so you can play Angry Birds Stella or Fruit Ninja for free. The strategy behind the move appears to mirror the company's strategy with Amazon Prime: analysts suggest that Prime subscribers spend about twice as much on Amazon than non-Prime shoppers. If the allure of free apps convinces users to use the Amazon app store instead of, or at least in addition to, Google Play, then that gives Amazon one more opportunity to sell you diapers, dog food, and whatever else it is that you might buy.