Microsoft Points are dead (or may be soon) ... long live Amazon Coins
May 20, 2013
If you’ve ever owned an Xbox, you’re probably familiar with one of the most annoying payment systems known to humankind: Microsoft Points. They’re great for Microsoft’s bottom line, and nothing but a hassle for customers. Well, the folks at Redmond may finally be ready for change – as the dreaded points are reportedly on their way out. Yet, not far away – at that other Seattle-area tech company – Amazon just launched a similar payment scheme for its Kindle Fire ecosystem.
The impending death of Microsoft Points comes from The Verge, who cites “people familiar with Microsoft’s Xbox plans.” Supposedly the Points will be replaced by – gasp – traditional credit and debit cards, as well as iTunes-like gift cards. This can only be seen as a win for Xbox owners.
So what is Amazon doing? Why, it’s launching its Coins virtual currency ... you know, the one we told you about back in February.
If you own a Kindle Fire, you’ve probably already gotten an email telling you about 500 Amazon Coins (a US$5 value) waiting for you in your account. That same email might also tell you that you can save 4 percent by buying Amazon coins in bulk. Can’t complain about free money, right?
Well, that depends. As it stands now, Amazon Coins are harmless. Because there are two key differences between it and Microsoft Points. First, each Amazon Coin is the exact equivalent of a US penny. Unlike Microsoft’s system, it’s simple to know how much bang you’re getting for your buck.
But the much more important difference is that Amazon Coins are optional. You can still pay for Kinde Fire content with a regular old credit card. It isn’t forced on anyone. So, even though it might lock some customers’ money into the Kindle Fire ecosystem, they're only putting it there out of pure choice.
Cause for concern?The only concern is if either of those things change. There’s nothing stopping Amazon from eventually changing the value of Amazon Coins (the Terms & Conditions give Amazon the right to change its terms at any time). This could not only lead to Microsoft-esque confusion, it could actually lead to people losing money.
There’s also the possibility that Amazon could eventually require Kindle Fire customers to use Amazon Coins for all purchases.
But we’re going to give the customer-centric Amazon the benefit of the doubt here. As much as any company likes its platforms to be as "sticky" as possible, it’s hard to see Amazon’s brass seeing either of those potential moves as anything but hostile toward their loyal customers.
Let’s keep our fingers crossed that Jeff Bezos and company learned the right lessons from that other Washington state company.