This week, the iPad app world is frantically sorting through some recent changes in its environment. Last Monday, Apple quietly altered its app approval policies in a way that will make publishers much happier. Specifically, Apple has relaxed control over whether apps can access content paid for outside of the App Store’s purchase APIs. The company has also allowed publishers to price however they want, both outside and inside of the app.

In the same week, released a subscription-based HTML5 web app intended for iPad users that bypasses Apple entirely, giving the publisher its own path to market that does not depend on or enrich Apple directly. The coincidence of these two events is not lost on most of us industry observers and is the topic of a Forrester report issued by my colleague Nick Thomas last Friday. In it, Nick explains why the FT’s move is probably the first of many such moves by the most recognized publishers, even with Apple’s newly announced policy reversal.

But while publishers figure out their next steps for their content apps, there’s one app that no one is talking about but I believe everyone should have their eye on. It’s the Amazon Kindle app. This app violates even Apple’s revised policies and will soon face a day of reckoning when Apple's June 30th deadline for compliance comes up. 

I don’t claim to know Amazon's plans, but I will claim to tell Amazon what it should do:

  1. Release an updated, compliant App Store app, with a little attitude. Amazon should release an app that complies with Apple’s new rules but with no Buy button at all. Instead, it should be positioned as a Kindle reading app where people who have purchased Kindle books elsewhere can read them on an iOS device. And the company should just let these readers know that although it would like to help them shop for and buy books, it is not allowed – as per Apple’s policy – to do so. This is how the company handles eBooks it does not control pricing for, simply informing the customer that it’s not Amazon’s fault a digital book costs $12.99 when the hardback is available on Amazon for $13.99 (see Hillenbrand’s Unbroken for  an example of this).
  2. Release an amazing HTML5 “app” that gives Kindle readers everything Amazon has to offer. The challenges of HTML5 should be nothing for Amazon’s developers. Building an app-like experience for web browsers on any HTML5 device opens doors for Amazon to expand its customer relationship to include Netflix-style video streaming, paid VOD, and its cloud music service. Think of it as an Amazon iTunes store – not just a Kindle store – and now is the time to do it, while all eyes should be fixed on Amazon.

None of this deals with the hardware side of Amazon’s business, where the company is falling far behind rival Barnes & Noble which has two Nook devices that make Amazon’s current Kindle crop feel a bit like Palm Pilots.