Windows Phone 8 : Making Money - What Is the Store?

10/12/2013 3:27:54 AM

The Store (or the Windows Phone Store) is where phone users can download and/or buy applications. On the phone, an app called “Store” lets users browse, download, and optionally buy applications that developers have written. The Store is one of the main hubs on the phone, so it encourages users to look around and find applications (as shown in Figure 1).


FIGURE 1 The Store hub

The Store is segregated into several categories of applications. The hub also shows highlighted apps that the Store team decides to promote on the hub. You do not have control over whether your application shows up here or not. In addition to the Store on the phone, the Store is available on the Internet. This site enables users to look in the Store and browse/buy applications. Items purchased from the online Store are wirelessly delivered to the phone. You can find the Store on the Windows Phone website by choosing “Apps and Games” as shown in Figure 2.


FIGURE 2 The Windows Phone Store

This is where you want your Windows Phone application to be showcased. Although developers can install .xap files manually for up to 10 applications and enterprises can add applications directly to phones, for mass appeal you need to be in the Store.

How It Works

The purpose of the Store is to provide a place for your application to get the exposure it needs to be successful. For any application sales, Microsoft splits the profits for direct purchases from the Store. Microsoft keeps 30% and pays you the remaining 70% of any sales you make on the Store.

You will develop your application using the Windows Phone SDK and get it ready for submission. Submitting your app involves uploading the .xap file as well as metadata about your application. Microsoft takes this information and performs a series of tests against your .xap file, including testing it on several devices (although the devices it uses are random per application). If your application passes, it is signed by the Store (which is what makes the .xap file executable on the phone) and deployed so that it can be downloaded/sold. Before you plan to submit an application to the Store, you will need a membership to the Store’s Dev Center. The Dev Center is the gateway to your applications in the Store. Figure 3 shows the join button on the Dev Center’s home page (

You might already have an App Hub membership, as it’s required to unlock a device to test your application on a phone.


FIGURE 3 The Windows Phone Dev Center

The cost for joining the Dev Center is $99 in the United States (and should be similar in other markets) per year for individuals or companies (students can join for free by being in the DreamSpark program). If you have an active MSDN subscription, you can use a code to get a free membership as well. By joining you get several important benefits:

You can submit an unlimited number of paid applications to the Store.

You can submit up to 100 free applications to the Store. (Additional submissions cost $19.99 per application.)

You can update your applications on the Store for free (regardless of whether the application is a paid app or a free app).

You can unlock up to 10 phones for development purposes. Unlocking a phone enables you to debug on the phone and manually install up to 10 applications.

When you join the Dev Center, the membership is not instantaneous; before you can submit your own applications, you must follow these steps:

1. You apply for membership to the Dev Center.

2. You supply identity information during signup.

3. You supply a credit card number (or PayPal) to pay the $99 fee.

4. An identity company (probably GeoTrust) contacts you to confirm you or your company’s identity. This information is used to ensure that people publishing apps on the Store are who they say they are.

After you have completed the signup and identity check, you’ll be able to use the Dev Center to unlock phones and submit applications.

Charging for Apps

If your goal is to make money on the Store, you will need to understand how Store sales work. You can price your app anywhere from $0.99 to $499.99 in U.S. dollars. There are fixed price points between those two amounts, so you can’t choose any random price for your application. These price points are picked purposely so that they can be converted into local currency in all the countries the Store serves. Currently, the Store is supported in many countries (although new countries might be added at any time). In these countries, the amount you charge is converted from U.S. dollars to a standard price in those countries. For instance, if you charge $2.99 for an application in U.S. dollars, this would be converted into a standard price in the other markets (this is not a straight currency conversion, so the pricing will be attractively described), as shown in Table 1.

TABLE 1 International Pricing Example


You can set up special pricing per market on the website, but using the standard price matching is easy and appropriate. Fixed pricing is the only model available (for instance, subscription pricing is not available through the Store). You cannot charge for updates to an existing application. And there are no refunds from the Store.

When you are determining what you want to charge for an application, you also should consider the fact that users will want to try your application before they buy it. Allowing users to try your application will improve its overall sales and downloads.

Your two options in this regard are to offer a “Lite” version (a free version) of your app or to support a trial mode for your app. There are benefits to both approaches. A free version will help to attract users who might be looking only for free applications (and your great app might get them to decide to purchase the app). Free apps also can get higher visibility because the top 100 apps on Windows Phone are separated into “Free” and “Paid” categories. A free version would be a separate version of the application (although probably sharing 99% of the same source code) that is limited by ads, nag screens, or limited functionality.

Supporting a trial mode for your app will enable users to download it before they buy it. Unlike the Lite version approach, the trial mode allows users to upgrade quickly (instead of having to install the full version as a separate application). See the sidebar “Using Trial Mode” for more information on how to implement a trial mode version.

Using Trial Mode

Some applications in the Store are available in trial versions, enabling users to try the applications before they buy them. You as the developer have programmatic access to whether a user is using the trial mode or the full version of your application through a class called LicenseInformation. This class has a property on it called IsTrial that returns a Boolean value that states whether the app is a trial mode or full version. You can create an instance of the class and test the property like so:

LicenseInformation lic = new LicenseInformation();
if (lic.IsTrial)
  // Buy Me Nag Screen

Using this class, you can test whether trial mode is enabled to prompt the user to purchase the application. You should cache this value in your application after it starts up because testing this property can be resource-intensive. In fact, the Application Certification Requirements require that you cache this value, or at least not call it frequently.

Getting Paid

As stated earlier, when you sell applications on the Store you receive 70% of the total sales you make. Currently, Microsoft is paying members of the Dev Center after they break the minimum $200 threshold in a particular quarter. All payments are made via bank transfer, so you need to be able to give Microsoft banking information in your local market. The Store currently allows for payments to developers living in a number of markets. In fact, Microsoft is supporting payments to developers in more markets than the number of countries the Store supports, so you can be a Windows Phone developer in quite a number of countries.

During registration you will need to give Microsoft your banking information so the company knows how to pay you, as well as your tax information. This tax information is different for U.S.-based developers than developers outside the United States.

Tax Information for Developers in the United States

Developers residing in the United States must provide a tax identification number for Microsoft to report any earnings to. This would be a Social Security number (SSN); an Individual Taxpayer Identification Number (ITIN) for individual developers; or an Employee Identification Number (EIN) for corporations, partnerships, or associations (including nonforeign estates and domestic trusts). These tax identifiers are used to report any revenue you receive from the sale of your applications.

Tax Information for Developers Outside the United States

For non-U.S. developers, the process is a little more complex. Because you are likely not considered a “U.S. person” by the U.S. Internal Revenue Service (IRS), you must provide a U.S. tax identification number; otherwise, Microsoft is required (by law) to hold back 30% of all revenue for tax reporting. Your country might have a tax treaty with the United States, so that income earned in the United States will be paid without the withholding tax. Most developers will want to apply to avoid the 30% holdback, a process that requires you to send a copy of the IRS’s W-8 form to Microsoft. However, this form requires an identification number. As a non-U.S. entity (person or company), you can register for an ITIN by filing a W-7 form with the IRS. Microsoft provides on its website a form letter that you can submit to the IRS with the W-7 form. You can see a complete walkthrough of the process for non-U.S. developers on the Dev Center at

You can also optionally submit to Microsoft a Valued Added Tax (VAT) identification number if you want to avoid being charged VAT in your country. This relates to VAT, GST, and QST (depending on which country you’re in). When you supply the VAT identification number, Microsoft will send you a hard-copy tax invoice (HCTI) if that is applicable in your particular country.

When pricing your application, understand that the pricing might or might not include these taxes depending on your country. Depending on the specific country, you may be responsible for paying the taxes directly or Microsoft might remit them for you. You will want to see the current tax and payout implications for your country of origin. You can find this by going to the MSDN documentation on pricing (available via this short URL: Users can decide to pay by credit card through Microsoft billing or mobile operator billing. How quickly you are paid depends on how the user pays for your application (still dependent on reaching the $200 plateau before payments are processed). Here are the options:

If the user pays by credit card (currently the majority of payments), you will get paid 15–30 days after billing the user.

If the user uses mobile operator billing, you will get paid 90–120 days after billing.

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