Further Thoughts On Raising Prices
I don't normally do this, but I'm going to revisit what I wrote last week in an attempt to clarify some misconceptions that I saw in the comments. At first, I was just going to post a comment of my own, but when I realized how much I had to say, it hit me that I would be better off just posting it here instead. So, let this be the end of the discussion. If you still don't understand me after this, then I'm afraid you are doomed to die with unanswered questions.
Of all the comments, "developers need to advertise" was my favorite hallucination. The basic gist to this (and other similar ideas) seems to be that if enough people knew about some of these great $9.99 apps then they would stop buying "iFart Mobile" and instead make wiser purchases.
Yeah. . . anything's possible.
This line of reasoning bothers me because it is all part of the greater idiocy I like to call "it's the developer's fault because. . ." fallacy. This fallacy get repeated in various forms but it always boils down to the same thing. These are all examples of this argument:
"It's the developer's fault because. . ."
". . . their game is too short."
". . . they didn't advertise enough."
". . . the app isn't worth it."
". . . I'm absolutely not a cheap tightwad."
". . . it can't possibly be Apple's fault."
But let's change pace a little bit and actually deal with a real world example. The game Crash Bandicoot Nitro Cart 3D currently holds the #1 spot in the game section of App Store. What's more, it is also the 2nd most popular app for the entire App Store. Clearly then, this is a popular product. Published by Activision, this is the 15th game in what has become a very successful franchise. So, we have a world class set of developers, backed by a publisher that is both popular and successful and they are producing a game in a well known series. A series for which plenty of advertising has already been done. So how much are they charging, these consummate professionals?
$5.99
So with all they have going for them, with all the talent and the advertising and the name recognition and as good as their game is, they feel that their product is worth only $5 more than a product that makes farting noises. How then can we expect developers with less resources to make any money? Or perhaps a better question would be, why bother?
Think about all the effort that went into making that game. Now think about the 30 min. it took some guy to write iFart. Why bother with quality products at all? Why not just find a gimmick and try to pump it for all it's worth?
Raising the base price helps keep good developers in business and gives users a better line of products to choose from. If something isn't done soon all you will see on the App Store is farting apps and the occasional watered-down port of a popular game. And if you wanted anything in between then you are just out of luck. So someone please tell me again why that is a good idea?
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I don’t think that addresses the whole problem. I agree that there is a lot of crap on the store and that raising the minimum price would get rid of some of it, possibly even iFart. However, I don’t see iFart as the biggest problem. My interpretation of the situation is that shoddy, less featured versions of useful software are the actual problem. I am not convinced that the same solution would get rid of those, possibly only cost us more to find out that a piece of software is actually a piece of crap.
Personally I don’t download tons of apps, 12 currently ( I just looked). I have a few games and a few utilities but generally speaking, I try to keep a crap free life as much as possible. If it doesn’t have a use then I get rid of it. I would pay almost any price for a utility that helps me save time or consolidate tasks but if that app were an iPhone app and the cost were similar to something I have on my laptop, doesn’t get bought. For instance Keynote remote is .99, SOLD. Keynote remote 4.99…... I have a remote that came with my laptop, in my bag already. I think Apple understands this and that is the reason for the price point.
There needs to be a better way to review these apps and competition will take care of the rest. James and Chris, I will lay it at your feet. Call it, App or Crapp, unbiased, contextual feature reviews of all apps. Viola! Problem solved.
The part that I don’t understand about your proposal - or, more to the point, I think you need to address - is why arbitrarily raising prices is not necessary with other types of software.
In the non-mobile software space, there are no restrictions on price. I can give my software away for free, charge a dollar, or 50 cents or $500. It seems difficult to argue that price compression is somehow Apple’s fault, or Apple’s fault, when this type of thing doesn’t happen in the larger software markets.
Personally, I think a better solution is demo/trial software. If Apple supported the ability for a developer to release a full version that would work for 5 days, or 10 launches and *then* charge a user (after a verification, of course), I think that would help.
I mean, would you spend $500 on software that you’d never used before? Probably not.
I think that people just don’t expect much from a mobile app. Even if Word or Excel gets ported to the iPhone, I wouldn’t pay as much as I might to use at work, because it won’t get as much use. I think there is a perception that games are just worth less there…
Finally, since some things are ad supported, if you got rid of the 99 cent price point, many things that were there won’t go away, they will just become ad supported “free” games. Since they won’t go away (indeed, they’ll be free!), I don’t think you’ll see the effect your hoping for.
James, your point is somewhat undermined by your own example. The gist seems to be that a higher base price will weed out the crap so that customers can get to the good stuff, the stuff that’s actually worth paying for.
But if Crash is the good stuff, and if it’s the #1 selling game, then haven’t customers weeded out the iFarts of the world and FOUND the worthy titles?
By your rationale, why allow free stuff too? Isn’t there more free crap than there is $1 crap?
If you can’t compete against iFart, then who says you can compete at all? I don’t think that less choice and a false market of artificially inflated prices are the solutions, but then again I also don’t like the idea of ONE store with one gate-keeper either. In many ways, less choice and inflated prices are the Apple way.
James, agreed again. Crash definitely should be a $9.99 app.
I actually bought $10 app this week *ONLY* because I was able to access a pseudo-trial of it beforehand. That app is Things, and the pseudo-trial is its Mac sibling.
As Apple doesn’t support trials, I think any developer who wants to charge more than a few dollars really should have a video up on YouTube of it in action.
Alternatively, like some other developers are doing, they could create a free lite version. A good example is WhatTasks. I used the lite version then decided it was worth getting the paid version. (However, as you might guess from above, I later moved on to Things.)
I greatly worry about what the App Store is doing to people’s expectations of software pricing. How long before Mac developers find people won’t pay even $99 for software. I’ve got a whole other article coming about that one.
You know, the computer market is obviously broken if Apple has only 8-9% marketshare. I know—Let’s ban all computers selling under $1,000! Let’s drive Acer and their damn netbooks out of business. They’re going to threaten Apple soon if we don’t!
I’m sorry. I really don’t understand the logic behind this. The article is especially odd coming from the person who complained the iPhone store having too many restrictions. So you’d rather have this wall patrolled by a doorman who checks to see your jewels are fancy enough rather than by a prison guard.
Price controls hurt far more than they ever help markets, and yes this is exactly what you are asking for here. Resorting to price controls prevents the participants from either adapting to the market or from figuring out why the market is broken. (Ask me sometime about the effects of price controls and subsidies we have on agriculture.) Is it not likely that the iPhone app consumer is not the same type of consumer as a PC app consumer? iPhones and iPods have a different use profile than a computer, Mac or PC. From what I read, the iPhone developers aren’t willing to consider this fact.
That said, they do suggest one possibility that could be just as likely: that the way Apple run its app store is a problem as well. That Apple is the central depository for app purchases hamstrings promotion. Given that the sales success of an app is almost exactly proportional to the promotion of that app by Apple lends credence to this belief. If that is the case, then the best solution would probably be allowing programs to be distributed outside of the app store.