

Engadget: iPad app prices are out of control and will kill us all - tjakab
http://www.engadget.com/2010/04/05/editorial-ipad-prices-are-out-of-control-and-will-kill-us-all/

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cscotta
Interesting - yesterday morning, I found myself suggesting the opposite:
<http://twitter.com/cscotta/status/11604836074>

I'd counter that this emerging pricing structure suggests developers are
finally charging fair prices for their software, and that this is a good
thing.

I don't mean to be a curmudgeon, but I'd suggest that the move towards
"free/freemium" across the web has helped to breed a sense of entitlement in
users while devaluing the work of interface design and software development.
To see a user buy an app for 99¢ on which a dev team spent months, then pan it
with a one-star review complaining that it doesn't have a feature s/he dreamed
up is ludicrous.

Geometry Wars from Activision is $9.99. After watching a demo on YouTube and
finding it as good as (or better than) the Xbox version, I snapped it up and
couldn't be happier.

I'm glad to see that developers are charging what their worth. This is good
for software, and good for users.

~~~
wmf
Yeah, I don't understand the complaints about $10 iPad games; an indie PC game
is $20 and a "AAA" PC game is $50.

~~~
patio11
For these customers, an indie PC game is $0, an AAA PC game is $0, a song is
$0, a movie is $0, and you want TEN FREAKING DOLLARS for your iPad app.

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credo
The writer seems to think that an app shouldn't be priced higher than $0.99
unless it is a life-changer.

I'm guessing that this stems from his mistaken belief that "Developers could
make millions with a well designed, useful, or entertaining app"

I wonder if every $4 he spends on other things is a life-changer for him :)

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protomyth
18 apps for $95.88 doesn't really sound that greedy. How much are 18 lattes at
Starbucks?

~~~
potatolicious
This speaks to the quality of apps in the App Store though - sadly, there is a
truth in the middle ground between the two viewpoints:

\- Genuinely useful apps are worth well in excess of $0.99.

\- iPhone consumers have been spoiled rotten by hyper-competition and the
market of $0.99-no-matter-what.

\- There's a _lot_ of utter shit on the App Store that isn't worth the $0.99
people are charging for it.

The App Store signal to noise ratio is atrocious, and consumers have responded
in their attitude towards app pricing. Bad apps are so plentiful (and have the
same level of exposure as the good apps) that everything over $0.99 is a risk
to the consumer for getting burned. Most apps are things that you'd start
once, get bored with in 5 minutes, and never touch again, and provide little
to no lasting use to the consumer whatsoever - it's not a surprise that
consumers are tuned to paying $1 for such things.

~~~
rmc
But 90% of anything is crap (<http://en.wikipedia.org/wiki/Sturgeons_Law>
Sturgeon's Law). 90% of the internet is crap, etc.

~~~
potatolicious
We have very good ways around this crap - Google, for example, will not
surface this crap (well, it does sometimes), and the networked/social nature
of the modern web is intrinsically some kind of quality filter (or at least,
relevance filter).

If some guy creates a crappy website full of information nobody wants, it will
never get visited.

If some guy creates a crappy iPhone app, it gets a disproportionate amount of
exposure compared to good apps people actually want to use.

The problem here is the with only a single portal that serves as both sales
and marketing, the wheat mixes with the chaff and you don't know which way is
up.

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benofsky
I've always thought iPhone apps have become too cheap and are grossly
underpriced. iPad apps will take longer and require more skill to make, they
should be more expensive. and at an average price of ~$5, that's not much at
all.

I wish iPad app prices would stay at this level but they will almost certainly
become diluted down to the iPhone levels (remember a year ago iPhone apps were
~$5).

~~~
barlo
For some reason, many people tend to greatly undervalue their time and effort.

I have a couple of apps in the AppStore. All of the apps that I've made were
initially solely intended for my use, but I usually end up throwing them on
the AppStore, mostly for the fun of it.

One of them is a extremely simple app I literally put together in about four
hours; when I put it on the AppStore I priced it at 99 cents just to see what
would happen. Surprisingly (for such a simple app), I was getting a steady
5-10 sales a day. A couple of weeks later, I jacked the price up to $3.99 just
to see what would happen. For the first week at $3.99, I actually had between
15-20 sales a day. Since then, my sales have never dropped below 8 sales per
day.

By increasing my price, I actually had a net increase in both quantity sold
and revenue.

As with most products, higher priced goods are perceived as having more value
than their lower-priced counterparts - even in the AppStore.

~~~
benofsky
Wow, that's really interesting. I can definitely see how that would work
though, most of the 99c stuff on the app store is utter crap, I tend to just
mentally skip over it. :-)

~~~
barlo
Have you seen the article about the game that was initially launched at 99c
and then progressively increased to $350? It's really the best example I've
seen about how bad the pricing in the AppStore has really become.

I'm not sure that this is the original source, but its Google's first result:
[http://www.gamasutra.com/view/news/27628/GDC_Refenes__Saltsm...](http://www.gamasutra.com/view/news/27628/GDC_Refenes__Saltsmans_Baffling_350_App_Store_Success.php)

~~~
weaksauce
I saw that too but I think that the reason that guy got kicked off the app
store was for getting a lot of chargebacks. I think the people buying the app
were confused as to the actual price because it's hardly the case that a game
would cost $350 maybe $3.50. When most of the purchasers were all confused it
hardly seems fair to extrapolate a unified theory about how bad the app store
pricing is. But that is just my interpretation of the article.

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gte910h
I counsel people to consider $15-45 per app.

You need a lot fewer buyers at that point to pay for your development.

Remember, the reason apple can sell iWork at $20 is because __they get money
off of every sale of the ipad __

~~~
collision
$30, actually -- Pages, Numbers and Keynote are all $10 each.

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josh33
It's easier for developers to start high and adjust prices lower over time to
increase sales. The article says $4.99 seems to be the iPad defacto app price
for many apps. If that's high, people won't buy. Or other developers will come
in and produce cheaper apps. As a side note, the article does mention the hope
that Apple eventually releases some type of trial functionality.

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jacoblyles
Maybe this is because iPad apps are viewed as "real" software and iPhone apps
are "toy" software, due to the screen size differential.

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dgallagher
There's a lot of "testing the waters" going on now with iPad app pricing.
It'll take several months before pricing models settle. We saw this when
iPhone os 2.0 came out. Lots of $5 and $10 games. As more competing apps
became available, and the number of iPhone users increased, prices came down.
This took months to play out, and it'll probably be similar with the iPad.

Right now I don't see many people buying a $4.99 issue of Time for their iPad
when you can subscribe to the paper edition and get 56 issues delivered to
your door for $20. Yes there is a convenience component to the digital
version, but a 1,400% markup in price isn't going to fly in the long run. Lots
of experimental pricing like this will be going on for a little while. Early
adopters will jump and spend money on content like this to show off and learn
about their new device. But that'll dry up after a bit.

It's always easier to lower prices than to raise them. So it makes sense stuff
will start off high. By late summer or maybe even by fall we'll have a better
clue regarding iPad pricing models. More people will own them by then, and
there will be more content available, competing for business, driving down
prices.

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smackfu
Prices also set expectations. If you pay $1 or $2 for an app and it's no good,
you get on with your life. If you pay $15 or $20 and it's buggy or doesn't
work, you complain in every forum about what a rip-off it was and write a one-
star review.

More expensive apps also require more energy to market them. Three screenshots
in the app store don't cut it. You need a proper website, and a screencast
video, and such.

~~~
eelco
It's a delicate balance, actually. If you price your apps too cheap, people
with no real interest will buy them, run it once, uninstall it and give it one
star.

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ryanhuff
The higher average prices (relative to the iphone) are simply a reflection of
the more limited population of apps released on day one. Once independent
developers get their hands on physical devices, and more applications are
released, we'll see average app prices drop.

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davidedicillo
I'm glad to see prices raise a bit. People don't understand how much work we
put into applications.

~~~
patio11
The amount of work we put into applications has _absolutely nothing_ to do
with what we can charge for them. Don't mention it around customers because it
doesn't motivate them and don't mention it around developers because it causes
them to consistently underprice.

Honorable Call of Warslaying Online had five hundred man years invested into
it and costs $60. Bingo Card Creator has, hmm, maybe 0.5 man years and costs
$30. Charge based on value, not based on cost, or you risk auto-commoditizing
your offering and locking yourself into a business which does not outscale the
day job but has no stability or benefits.

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hexis
Personally, I expect iPad apps to be cheaper than iPhone apps over time. I
expect more iPad apps to be ad-supported, due to the larger screen size. It's
not the direction I'd like things to be going in, but my experience with the
web makes me think that zero tends to be the winning price if it's possible.

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ComputerGuru
Why do they expect iPad app prices to be cheaper than MacBook app prices?

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elblanco
Two possible things will happen.

1) Prices on the apps will drop.

2) The complexity of the apps will increase until they have the perceived
value of what the purchaser wants.

