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Emerging Payments

Amazon.com to Launch a Virtual Currency, 'Amazon Coins'

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Amazon.com Inc. today announced plans for Amazon Coins, a virtual currency for its Kindle Fire tablet.

Amazon.com will launch the currency in May, at which time it plans to give its customers "tens of millions of dollars' worth" of free Amazon Coins to spend in the Amazon Appstore, according to  Amazon.com's press release. Users will be able to purchase more Amazon Coins with their existing Amazon.com accounts.

Developers of games and other apps will earn Amazon's the same 70% revenue share for sales completed with Amazon Coins as they do for other payment methods. One Amazon Coin is worth one penny — a $2.99 Kindle Fire app would cost 299 Amazon Coins. Only U.S. customers will be able to use Amazon Coins at launch.

With Amazon Coins, Amazon.com seems to be moving in the opposite direction as Facebook, which announced last year plans to phase out its Facebook Credits digital currency to instead allow developers to price apps in local currencies. Though Facebook initially expected to phase out Credits by the end of 2012, it still supports Credits today.

Amazon.com says Amazon Coins will be offered in addition to U.S. dollars for Kindle Fire users. "Amazon Coins are simply another payment method honored by the in-app purchase flow," Amazon says on its website.

The purpose of the Amazon Coins currency is to allow "another new way to help developers reach even more of our millions of customers," Paul Ryder, vice president of apps and games for Amazon.com, says in the press release.

"We've already found that the average revenue per user on Amazon is higher than other Android platforms," said Keith Shepherd, CEO of Imangi Studios, in the release. "We're very excited about the monetization opportunity with Amazon's new virtual currency."

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