Apple hasn't messed up app store pricing - Tal Talk
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Tal Atlas

I build stuff, currently tumblr. In the past also worked on Delight, Gilt City, and OMGPOP.

Here I write about some of my favorite things: tech, hockey, and programming, with some tv/movies sprinkled in.

Apple hasn't messed up app store pricing

Or how I learned to stop worrying and love IAP

Lots of shade has been thrown regarding Apple's stewardship of the App Store. I don't want to go into details about every claim made against the App Store, many of which I agree with, but I do want to defend a few choices that get the most attention.

  1. Time based trials
  2. Paid upgrades

Both of these issues are brought up as some of the main reasons prices in the store are unsustainable and indie developers can no longer make a living. My contention is that apple provides most developers with the tools they need to extract more revenue and make apps with trials.

Time based trials

Time based trials, or easy refunds, are a tried and true tool for desktop software to give users a taste of an app without requiring a full purchase. The theory being that if users knew the purchase was reversible or would have time to test it out more users would be ok with higher priced apps.

Blaming the suppressed prices in the app store on the lack of trials is overly simplistic. The low prices are a simple outcome of supply and demand. With so many available users and distribution becoming so much easier a race to the bottom was inevitable. The poor iPad suffers the fate of sharing a store with the iPhone where the mental price for an app has been set to be very low.

Apple has already provided a better mechanism than time trials to give a user a sample of an app without having to pay full price up front. Time trials have a fatal flaw, you have limited time to discover why you should pay. Often a good use for the app won't be thought of within the window. Or you just forget to give it a more in depth look. Time trials can even make the user fearful to open the app out of concern that they'll waste the trial time.

In app purchases, or IAP, provide a much more user friendly way to provide trials. My favorite type of trial is to limit the number of items that can be input. This gives the user a sense of the full suite of functionality the app provides while placing the payment point exactly when a user has invested and would be willing to pay. This model also helps prevent people from waiting to try the app until they can fully test it, for fear that they wouldn't have enough time to make a full opinion.

Paid upgrades

Being able to extract money several times from your most dedicated users is an essential aspect of the viability of most software companies. Charging for upgrades is an aspect that the user and developer are in strong alignment. The developer is incentivized to continue to improve the product and users who are gaining the most value pay be most.

Many complaints come around the inability to charge existing users less to upgrade rather than to buy it outright. As a response app developers will often create a separate app that starts out at a lower price as a simulated upgrade pricing scheme.

The problem with these complaints is that the App Store already provides the ability to charge for upgrades in the form of IAP. These are even better than paid update because it allows the user to choose to pay only if they find the new features compelling enough.

End

There are many valid complaints against the App Store. But I think it unfair to count monetization strategies amongst the issues.

With forward thinking and not blindly relying on past strategies the App Store provides an experience for payment that's a much better experience for users than the old paradigms provided.