In a brilliant move by Amazon, they have secured an exclusivity on the latest version of the hit game Angry Birds, Angry Birds Rio. It will be sold in Amazon's new app store and will not appear in the Android Market, at least not right away.
This is obviously a great thing for Amazon because it will get mind share for their new app store, and they will probably get a lot of downloads. However, this market fragmentation could become a problem with Android as a whole.
People will hear about the game being on Android and end up frustrated when they can't find it in the Market. Those who do know it is from Amazon will still have to figure out how to use the new app store, install it on their phone, and add payment information if they don't already have an Amazon account.
More importantly, this could cause unneeded fragmentation if it becomes a trend. I think that it would be a pain to have to go to multiple app stores to get the good apps, even if both are easy to use.
However, it is possible that having competing app stores will cause Google to improve their Market. It could certainly use some work at this point. Openness is the standard of Android, so there is not much Google can do about Amazon's store other than make theirs better. Even so, I don't find the idea of having multiple markets and exclusive applications appealing at all.[ZDNet]