The App Store and Retail Co-op

Marco Arment has a good piece today on last week’s Bloomberg report about a “Google-like” (Bloomberg’s description) paid search results program.

I’ve been meaning to write more about this. Perhaps comparisons to Google search are a red herring, and the right comparison is to Amazon, and retail co-op. Pay for placement, just like in grocery stores. Amazon has done this forever, and in the markets where they’re dominant (like books) they really turn the screws on manufacturers and publishers with the co-op fees. Think of search terms as being like the aisles in a grocery store, and the paid promotions are the endcaps. The retail co-op argument also fits better with the purported 100-person team size. Most of them would be sales people, not engineers or designers.

If Apple does it right, I think it’s just a new thing in the App Store that won’t make anything worse — but won’t address any of the longstanding problems, either.

If they do it wrong, they’ll allow shitty things like buying your competitor’s app’s name.

Also, Arment raises a good question, wondering about the motivations of whoever leaked the story to Bloomberg:

Either to warm us up to the idea so we’re not so mad in June, or by someone inside who doesn’t think it’s right and wants ammo to win the argument internally.

I’ve been wondering about this too. I don’t think it makes sense that it’s a trial balloon from someone in favor of the program. Apple doesn’t care about “warming us up” to changes. They don’t care. I think it makes more sense as a leak from someone opposed to it, and who foresaw that it wouldn’t go over well. Damn curious either way, though.

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