Apple 2.0

Covering the business that Steve Jobs built

How Apple drove Amazon's Kindle from the App Store

August 10, 2011: 10:34 AM ET

The new Kindle Cloud Reader paves the way for others to sidestep Apple's 30% tax

Note the restored Kindle Store button. Source: Amazon

Note the restored Kindle Store button, top right.

Steve Jobs made no friends on Publishers Row last February.

After flying to New York City in early 2010 to sell book and magazine publishers on the wonders of the iPad as a reading device (see Enter Steve Jobs with top hat and iPad), he announced subscription rules a year later that he said would "delight" readers but were widely viewed by Apple's partners as draconian (see Steve Jobs to pubs: Our way or highway).

Not only would Apple (AAPL) take a 30% cut of every title sold through the App Store -- a cut that an industry built on paper-thin margins could ill afford -- but apps with a link that took readers out of the App Store would no longer be approved.

The most prominent company affected by Apple's new rules was Amazon (AMZN), the giant bookseller whose Kindle app was one of the iPad's first runaway hits. In fact, for many early adopters, the Kindle app was one of the primary reasons to buy an iPad.

Last month, Amazon made a temporary fix: It reissued Kindle for the iPad without the Kindle Store button that made browsing and buying new titles a one-click proposition. (See here.)

On Wednesday, it went one-step further: It announced the release of the Kindle Cloud Reader, a new Web-based app that provides virtually all the functions of the original iPad app -- including that missing Kindle Store button -- without having to pay Steve Jobs' 30% toll. It works on Macs and PCs (using the Chrome browser), but it runs particularly well on the iPad.

Written from the ground up in HTML5, the Kindle Cloud Reader proves that it's possible to leave the App Store without leaving customers behind. It will be interesting to see how many other content providers follow Amazon's lead.

The Kindle Cloud Reader is available for free here: www.amazon.com/cloudreader

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About This Author
Philip Elmer-Dewitt
Philip Elmer-DeWitt
Editor, Apple 2.0, Fortune

Philip Elmer-DeWitt has been following Apple since 1982, first for Time Magazine, and now on the Web for Fortune.com.

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