Microsoft’s cash-for-apps pitch to devs smells like desperation, says analyst

$100 per published app makes company look like a cheapskate, adds another

Microsoft yesterday kicked off a promotion that rewards Windows 8 and Windows Phone developers $100 for each app that they publish in the company’s app stores.

Dubbed “Keep the Cash,” the promotion is Microsoft’s first overt cash-for-apps program, a tactic rivals Google and Apple have never used to attract submissions.

To one analyst, the $100-per-app pitch was an ill omen.
“It looks a little desperate,” said Patrick Moorhead, principal analyst with Moor Insights & Strategy. “It sends the message that Microsoft is having a hard time building out its app categories. And it doesn’t bode well for the Windows Store.”

Microsoft distributes Windows 8 and Windows RT “Modern” apps — the full-screen, tile-based software formerly tagged as “Metro” — through the Windows Store; smartphone apps, which do not run on Windows 8 or Windows RT, are channeled through the Windows Phone Store, a separate mart.

Keep the Cash will award a $100 virtual Visa card — good only for online purchases — to a developer for each app he or she publishes, with a maximum payout of $2,000 total for 10 Windows Store apps and 10 Windows Phone Store apps. Those apps must be submitted and published to the appropriate Store by June 30. Microsoft said it’s capping the number of rewarded apps at 10,000, meaning it’s putting $1 million on the line.

The promotion is intended to delivery quantity, not necessarily quality, the experts said.

“Clearly, they’d like to populate the stores as quickly as possible with more apps,” said Ezra Gottheil of Technology Business Research. “But it seems they want to try to pull in the 13-year-olds, because $100 is not at all meaningful to an established developer. Maybe they’re looking for the next generation of kid geniuses, and hoping to find the next killer app that comes out of nowhere.”

Currently, the Windows Store has nearly 49,000 apps, according to the MetroStore Scanner, a website that uses a counting algorithm created by Wes Miller, an analyst with Directions on Microsoft. Miller stopped tallying apps last December.

“They’re trying to spur interest,” said Miller in an interview today. He agreed with Gottheil that Keep the Cash was aimed at amateurs and hobbyists. “But I’d rather see a smaller number of high-quality apps than a larger number of lower-quality apps,”

That was Moorhead’s point as well.
“This doesn’t solve their fundamental challenge, which is to get A-list apps onto the app store,” said Moorhead. “What they’re going for is the long tail, a very long tail [of the number of apps], which is important, but it doesn’t solve the problem that they have, such as the lack of a Facebook app, the lack of support for important apps like Time-Warner’s TWC-TV.”

Both Moorhead and Miller have been long-time critics of Microsoft’s Windows 8/Windows RT app strategy, and have repeatedly pointed out that the new operating systems’ Modern user interface (UI) has a paucity of top-quality, must-have apps.

Miller wasn’t keen on the idea of paying for apps. “I agree with Charlie [Kindel],” said Miller, talking about a blog post from September 2012 where Kindel said paying developers cash was a bad idea.

In that post, Kindel — until mid-2011 the general manager of Microsoft’s Windows Phone developer experience — also predicted Microsoft would make the move.

“It is highly likely things are about to change and Microsoft is going to start directly incenting developers to build apps with cash,” Kindel wrote at the time. “If I’m right, and we start to see clear evidence that Microsoft is paying for apps, then Windows is in even more trouble than most of us already believe.”

Miller pointed out that Microsoft has quietly funded established app developers — either directly or in some circuitous fashion — to bring their already-available Android and iOS apps to the Windows platform. The company is probably still doing that, he added.

But even Gottheil, the most upbeat of the three analysts, knocked Microsoft for the small-change awards. “This gives people the perception that they’re cheapskates,” he said.

Microsoft has opened its checkbook. In mid-2010 the company launched a $250,000 contest for security researchers asked to create new anti-exploit technologies to better protect Windows users. The winner, Ivan Fratric, a researcher at the University of Zagreb in Croatia, was handed $200,000 for his work.

“I’m surprised that they didn’t go that route,” said Gottheil, referring to a competition with larger rewards.

Interested developers can review Keep the Cash’s terms and conditions on Microsoft’s website.

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