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Cellphones Businesses Apple

iPhone App Pricing Limits Developers 437

Posted by samzenpus
from the you-get-what-you-pay-for dept.
HardYakka writes "According to this post in the Fortune blog, the iTunes app store has been a boon for users but some developers are saying the number of free and 99 cent apps make it difficult for developers to create complex, higher priced apps. Craig Hockenberry of Iconfactory says the iPhone may never get its killer app like the spreadsheet was for the Mac. If Apple does not do something, the store will be left with only ring tones and simple games. Some are suggesting that overpaid developers are the problem and the recession will soon lower the wages and costs for complex apps."
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iPhone App Pricing Limits Developers

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  • Spreadsheet (Score:5, Informative)

    by penguinboy (35085) on Wednesday December 10, 2008 @09:54PM (#26069763)
    Visicalc was an app for the Apple II, not the Mac.
    • Re:Spreadsheet (Score:4, Insightful)

      by morgan_greywolf (835522) on Wednesday December 10, 2008 @10:18PM (#26069969) Homepage Journal

      Yeah, I have no idea why people think the 'killer app' for the Mac was the spreadsheet. The Mac's killer app was desktop publishing and, later, graphic design. To this day, there is still no better platform for DTP and graphic design than the Mac.

      • Re:Spreadsheet (Score:5, Informative)

        by stewbacca (1033764) on Wednesday December 10, 2008 @10:51PM (#26070309)
        Pagemaker (or Quark), Freehand (Aldus), Authorware/Director, and Photoshop v1.0 were the killer apps back in the late 80s and early 90s. Those programs are what made the Mac "insanely great" and the IBM compatibles go "beep" in all their mono-color glory.
        • Re: (Score:3, Informative)

          by drerwk (695572)
          I'm not positive that the Laser Writer was the first laser printer - but it sure did work well. I think this was critical in addition to the applications you list.
      • Re:Spreadsheet (Score:4, Insightful)

        by Saffaya (702234) on Thursday December 11, 2008 @12:04AM (#26070923)

        Uhm, no. You only say this because you never knew about the ATARI ST and its 1040 ST + SLM laser printer combo.

    • Re:Spreadsheet (Score:5, Insightful)

      by mabhatter654 (561290) on Thursday December 11, 2008 @01:04AM (#26071327)

      and the first rounds were cheap... prices for good software rise as the market proves GOOD software is hard to make.

      Right now iPhone is in "gold rush" mode. Every body is making everything thing at every price because nobody knows what the market is yet, it's been 6 months.. hardly time for doom and gloom.

      I think it's time to START complex apps as small apps and see how the market reacts. What can you sell for $1.99? The market is not ready to commit $29.99 to ANY app yet.. frankly if somebody else can make the same app for $2.99 then your app is not worth the higher price.

      There's three kinds of "complex". There's problems that are purely hard to solve like encoding video or building 3D game engines that take real talent to make it look easy. There are projects that are large and take lots of grunt work... ERP systems come to mind as simple programs but you need lots of them to work well or they take lots of content or research... think encyclopedias or the Sims again, it takes resources or creativity to make the volume of content required in a manner to sell it, not easy for good quality without money. The last are simply programs that are big... like office programs... They are easy to duplicate functions, but control the market because they have lots of little pieces and people using them. Unless you are in the first two groups don't expect to charge a lot.

  • by justcauseisjustthat (1150803) on Wednesday December 10, 2008 @09:54PM (#26069769)
    Simply add Top Apps categories for more price ranges...
    $1-$5
    $5-$10
    $10-$50
    $50- ??
    • by Anthony_Cargile (1336739) on Wednesday December 10, 2008 @10:13PM (#26069921) Homepage
      I'm more worried about the usage of the oxymoron "overpaid developer".
      • by frosty_tsm (933163) on Wednesday December 10, 2008 @10:22PM (#26070033)

        Agreed. Especially when you consider the low product quality that results and higher developer-count required to deliver with lower-cost developers.

        • by Anthony_Cargile (1336739) on Wednesday December 10, 2008 @10:32PM (#26070131) Homepage
          And if thats not bad enough, Apple may at any time remove an app designed by us "overpaid developers" just because it may conflict with an existing (or to be existing) Apple app, or if it just pisses Apple off (IAmRich).

          I've joked ever since I found out about this that Opera, the Mozilla Foundation and Sun should release their software for the jailbroken iPhones only, in addition to an Android port.

          Mobile platforms are the new platform wars: Android (representing Linux), iPhone (Mac), and Windows Mobile (Win). The next generation developers will have to port apps painfully across these platforms, or pick and choose at the cost of some customers. Not to mention other platforms like Blackberry and the like that don't fall into those categories, save Sun's JavaME portability.

          If I were ever asked to write a mobile client for any application of mine by anybody, public or not, I would probably shoot myself at the first thought of "But I have this phone". You can have it, spare me until the dust settles.
          </rant>
          • by tapehands (943962) on Wednesday December 10, 2008 @11:11PM (#26070477)
            oy. Seriously...if I were a developer that was considering writing an app that could be construed as "killer", the #1 turnoff would be Apple's ability to cannibalize my work.

            What recourse, if any, would there be if Apple decided to yank my $XX app off the store, only to have the same functionality trumpeted in a new firmware release? (like they already have done) [engadget.com]

            Futhermore, Apple chooses when and where to enforce their store rules. Google [cnet.com] is allowed to break rules. Would a small development firm be so lucky?

            There just isn't enough incentive or security to develop something much more useful than a game, ringtone, or eggtimer.
      • Re: (Score:3, Insightful)

        by Anonymous Coward
        What makes it an oxymoron? There are plenty of developers who get paid way more than they are worth. Heck, some developers actually have negative value, because they can damage projects and cost money to clean up after.
        • by Anthony_Cargile (1336739) on Wednesday December 10, 2008 @10:39PM (#26070205) Homepage
          No I wasn't talking about the same developers you are, e.g. coders that throw function pointers in directly with raw input and similar shit and wonder where the bugs/exploits come from (and get paid a wad to write those patches).

          I'm talking about the high quality, underrepresented programmers that get stuck in a low-end job that not only underminds their ability, but pays much lower than the quality of code is that they write, which would be much more suitable for the big companies the shitty programmers get put in. When they would hear "overpaid developers", the first thing they would think of is "Yeah, all I need is less pay".
  • What a whiner. (Score:5, Insightful)

    by Whiney Mac Fanboy (963289) * <whineymacfanboy@gmail.com> on Wednesday December 10, 2008 @09:55PM (#26069775) Homepage Journal

    Iâ(TM)ve been thinking about whatâ(TM)s causing this rush to the 99Â price point. From what I can tell, itâ(TM)s because people are buying our products sight unseen. I see customers complaining about how âoeexpensiveâ a $4.99 app is and that it should cost less. (Do they do the same thing when they walk into Starbucks?) The only justification I can find for these attitudes is that you only have a screenshot to evaluate the quality of a product. A buck is easy to waste on an app that looks great in iTunes but works poorly once you install it.

    Why not release a free, crippled version of your app that allows people to look at it, evaluate it & decide if it's worth $2.99? Now where have I heard of that business model [wikipedia.org] before?

    Honestly, there's so many development restrictions on iPhone apps, why bother publicizing this non-story.

    • by Fluffeh (1273756) on Wednesday December 10, 2008 @10:26PM (#26070065)
      This is what most of the developers are doing. I have bought a ton of full priced games (that are $5-15) as well as a few apps after trying the free versions.

      I think the article could be slightly amended to read: "Poor quality high priced apps won't sell for iPhone" or even "high priced apps without a demo version won't sell on the iPhone" and it would be much closer to the mark.
      • Re:What a whiner. (Score:4, Informative)

        by sirambrose (919153) on Thursday December 11, 2008 @02:38AM (#26071807)
        Lots of developers are making free versions, but apple restricts the developer from using the free version as an effective demo for the full version in the same ways that developers could on palm or windows mobile. Nearly all complex applications for palmOS had a time limited demo that allowed the user to try all the features. Usually the software would have a popup that reminded the user to pay for the software. If you didn't register after a few weeks, the software would disable all the advanced features or display a nag screen for 30 seconds at startup. Apple forbids an iPhone application from doing all these things.

        As a result, developers have to find a way to produce a fully functional free version of their software that lacks a few features that the majority of their users will pay extra for. In many cases, the majority of users will not pay extra for premium features even though they would have paid for a well built application on palmOS. People porting applications from palmOS are finding that they need to price their application lower on the iPhone store even though it is better than the other choices in the category. For example, the PocketMoney finance application cost $30 on PalmOS and it costs $10 on iPhone because people are reluctant to try applications without a demo version. If the author released a free version, it would probably be better than the vast majority of similar applications and very few users would pay for the full version.

  • by way2trivial (601132) on Wednesday December 10, 2008 @09:55PM (#26069779) Homepage Journal

    What the Hell? spreedsheets were the killer app for PC's period.

    it was not mac-specific-- it was a much earlier dawn of the PC age.

    "VisiCalc was the first spreadsheet program available for personal computers. It may well be the application that turned the microcomputer from a hobby for computer enthusiasts into a serious business tool.[1] VisiCalc sold over 700,000 copies in six years.[2]"

  • Right (Score:5, Insightful)

    by Junior J. Junior III (192702) on Wednesday December 10, 2008 @09:55PM (#26069781) Homepage

    Some are suggesting that overpaid developers are the problem and the recession will soon lower the wages and costs for complex apps."

    Because in the Shitty New Economy, people will be blowing all kinds of money on applications for their overpriced smartphones.

    • It is not so over priced. the iPhone is actually a very well designed phone, and it replaces well say an iPod Nano, a decent Cell Phone and a PDA. Plus you also have Wi-Fi and a bunch of apps and a usable interface. So say you pay $50 for a good phone on a contract, then $100 for an iPod Nano, and an other $100 for a PDA. and still not have all the features of the iPhone.

      As for over priced developers, being that these people are developing apps from scratch from a new platform you have about 150% added to

  • Prices will go up (Score:4, Interesting)

    by omeomi (675045) on Wednesday December 10, 2008 @09:56PM (#26069785) Homepage
    I think a lot of these free and low-priced apps will eventually go up in price. With the exception of the ridiculously simple apps like all of the various flashlights, I have a feeling that companies are putting apps out for free to get a lot of great reviews, and then plan to eventually jack up the price. I have to admit, though, there are so many free apps out there, it's difficult to find a niche that is likely to have a reasonable pay-off. That's life, though, I guess.
    • Re:Prices will go up (Score:4, Interesting)

      by joshv (13017) on Thursday December 11, 2008 @01:53AM (#26071595)

      I code Android apps in my spare time. So basically I've got zero cost. Each of my apps has at least 3 competitors, which seem to be coded by people like me. Granted, many of my competitor's apps look like crap, but they work and provide a valuable service. Most people aren't going to pay top dollar for teh shiny - they are going to buy the cheapest thing that works. So I don't envision ever being able to charge a lot for my apps. I also don't see professional development shops being able to compete with zero cost hobbyists.

  • BS (Score:5, Interesting)

    by Architect_sasyr (938685) on Wednesday December 10, 2008 @09:56PM (#26069787)
    This is utter crap on behalf of any developer. If you make a decent software app and it sells to 100,000 people for $0.99 then how much have you actually made. Yes it is a competitive market, but you sell your app for 0.50c and let people go with it. 100,000 people buying an app for 50c each should more than pay for it. An idea could be as complex as you like and I still can't see spending more than $100 Grand on it for an iPhone app.

    Unless you're a shitty developer or you're not writing a good app.
    • Re: (Score:3, Insightful)

      by pseudonomous (1389971)
      It might not be that you're writing a shitty app, you could be writing an app that appeals to a limited market segment. Suppose you wrote a great app for the iphone that transcribed single melody line audio input to classically notated sheat music. Your target market would then be people who can read sheet-music, have an interest in transcription, and own an Iphone. How many people fit that description? Suppose further, your software just outputs finale files, now you're market is the subset of music en
      • Re:BS (Score:4, Insightful)

        by lucas teh geek (714343) on Wednesday December 10, 2008 @10:39PM (#26070201)
        i think if your product is as niche as the examples you've laid out, you shouldnt have a problem with competitors undercutting you to the $.99 price point. in fact, if you're writing software that niche you can pretty well set the price to whatever you want since there's nobody else for people to buy such a product.

        on the other hand, if you're writing throwaway software (eg. todo lists) expect a lot of competition and that you're not going to be able to change as much as you want
    • Bravely Stupid? (Score:4, Insightful)

      by Gary W. Longsine (124661) on Wednesday December 10, 2008 @11:04PM (#26070425) Homepage Journal
      Your hired. You'll be paid $100k a year, and you'll write a new iPhone app for me every six weeks. An idea could be as complex as I like, and I still can't see it taking you more than six weeks to implement, unless you're a shitty developer or wasting time, in which case, you're fired.
      • Sarcasm is dead. (Score:5, Insightful)

        by Gary W. Longsine (124661) on Wednesday December 10, 2008 @11:58PM (#26070889) Homepage Journal
        Uhm... "Flamebait" this was not. Using the exact same argument as its parent, applied on the flip side of the developer relationship (cost, rather than revenue) should have merited an Insightful mod. Alas, there is no "understands subtle arguments" requirement for moderators.
        • Re: (Score:3, Insightful)

          by poot_rootbeer (188613)

          Using the exact same argument as its parent, applied on the flip side of the developer relationship (cost, rather than revenue) should have merited an Insightful mod.

          Except the parent poster intentionally tweaked the numbers to try to make the grandparent look foolish.

          The grandparent's assertion was that for $100K, it should be possible to develop an iPhone app of any complexity, given the practical limits of the device. The parent's sarcastic job offer did not rebut this assertion, but rather argued a str

    • Re:BS (Score:5, Insightful)

      by ScrewMaster (602015) * on Wednesday December 10, 2008 @11:21PM (#26070561)

      and I still can't see spending more than $100 Grand on it for an iPhone app.

      100k goes fast, and that's not even considering non-development-related costs. If your app requires hosting or has any server-side component, that's going to be an ongoing expense. If you aren't selling your product as a service, or have a subscription fee, those costs are going to have to be paid out of the take from new sales. If your app proves to be really popular, odds are you're going to need a support staff. That hundred grand is gone. Pfft.

      This is particularly true because any Apple-related product is going to be heavy on the graphics, and that's going to require art support (not many coders know their way around Photoshop or have any animation skills whatsoever.) Ditto on sound effects and music. A hundred grand sounds like a lot, but when it comes to software development and support nowadays, it really isn't.

  • by rolfwind (528248) on Wednesday December 10, 2008 @09:57PM (#26069791)

    One developer said:
    "Both developers and designers cost somewhere between $150-200 per hour."

    That's too much. I haven't used iTunes, but if it isn't based on simple popularity but has some kind of after-the-purchase rating system, there shouldn't be too many worries. If there isn't, they should implement one. With reviews and ratings like Amazon.

    I also have a hard time believing that only the most simple apps will get made, there seems to be a "10 Most Useful" iPhone App list every other week popping up at some social sites like Digg.

    • by Lumpy (12016) on Wednesday December 10, 2008 @10:06PM (#26069861) Homepage

      Exactly. It's a bunch of really whiney people complaining they are not making Millions overnight on the iphone.

      Guess what. Cellphones APPS DO NOT SELL IF THEY ARE EXPENSIVE.

      This is a fact that has been around ever cince the cellphone could run apps. Now we have a bunch of whiney babies complaining about the prices they can sell their crap apps at.

      What's next? They going to ask Washington for a bailout as well?

      IF Haji can write a app and sell it for $1.99 that you want to write and sell for $29.99, Haji is going to kick your ass in sales. Whining like little crybabies will not change that fact.

      • not exactly (Score:3, Insightful)

        No, you have definitely got it wrong. Most of the iPhone developers I know are exactly the opposite of whiny. They are energetic, hard working, play by the Apple defined rules, and working really hard to justify their really expensive hobby of making cool software. They tend to do this because they have experience with lots of other technologies, and they like the Apple technologies better, they are more fun for developers, but they are, often, less profitable.
      • Re: (Score:3, Informative)

        Guess what. Cellphones APPS DO NOT SELL IF THEY ARE EXPENSIVE.

        Tell that to Omni, who are making a killing off of OmniFocus at $20 a pop.

    • nope, that's not it (Score:4, Interesting)

      by Gary W. Longsine (124661) on Wednesday December 10, 2008 @11:14PM (#26070497) Homepage Journal
      There are lots of issues with making complex apps under this pricing universe, and it's definitely a deterrent to making more interesting complex apps. People seek technical support for complex apps. If the app costs $0.99, and they ask you a single question about a problem they caused themselves, they have burned enough time to tank a whole day's worth of sales.

      Another issue is that Apple doesn't provide software vendors with contact information for our customers, but does allow (and with iPhone OS 2.2 actively encourages) them to complain in the app store, under essentially anonymous handles, about issues that they caused themselves. For example, an app we make is highly praised by most users, but a few complain vociferously that it's "unstable" or "crashes a lot". Yes, in fact our QA tells us this is definitely true -- but only if you run it on a Jail Broken iPhone. Doh! So sorry you didn't contact us for support. So sorry you don't understand you shot your foot off and we neither gave you the gun nor pulled the trigger.

      iTunes App Store is basically an ongoing experiment. It's not clear that third party software developers can devise a business model on it which will make a profit.
    • by p0tat03 (985078) on Wednesday December 10, 2008 @11:15PM (#26070507)
      Well, contract developers *do* cost that much. I think the real headliner here is: "Useless People Who Must Contract Everything Out Find There's No Profit"... which is kind of a no-brainer. The people who can do their own design, code, and whatnot can operate in the iPhone space. If you're a PHB type who can't code, can't design, and just can't do anything except cook up wacky iPhone application ideas, then there's no room for you. Seems like there's nothing wrong here :)
    • by mini me (132455)

      $150-$200 per hour doesn't seem out of line for a decent company providing those services on contract. I don't think anyone is talking about an employee being paid those kind of rates here.

  • competition? (Score:5, Insightful)

    by arbiter1 (1204146) on Wednesday December 10, 2008 @10:02PM (#26069841)

    Another limiting factor on iphone app's is fact apple will kill off any app that competes with their's or anything they are about to put out.

    • Re: (Score:3, Insightful)

      by Ilgaz (86384)

      Imagine coding something like http://www.quickoffice.com/ [quickoffice.com] and Apple somehow decides "iPhone enterprise edition" and triggers kill switch on your app using an excuse like "but it does do excel macros, it is against rules".

      The real limiting factor is iPhone community which is totally unhealthy. "Cry me a river" etc. type crap comments from people who doesn't even have a clue about what developing a professional application is or who Hockenberry and Icon Factory is.

      It seems Symbian will be my mobile operating

  • It needs open apps no store lock in like Symbian phones.

  • Trism (Score:3, Insightful)

    by whisper_jeff (680366) on Wednesday December 10, 2008 @10:10PM (#26069893)
    Trism is a very simple example of an app that proves that developers can make money, and a lot of it. Last I hear, the guy that wrote the program has made over $250,000 on an app that he sells for $4.99. Why? It's really simple - it's a great game that's well worth the price. Free is fantastic and a majority of apps on my iPod Touch are free apps but, if the content is of quality and worth it, I'll pay for it. And so will thousands and thousands and thousands of other people. Complaining that some people are willing to do some coding for free isn't a way to make money. Make a quality product. If the people who complain about free apps making it hard for people to make money spent more time coding and making a quality app and less time complaining, they might make more money...
    • Re:Trism (Score:4, Insightful)

      by BigZaphod (12942) on Wednesday December 10, 2008 @10:39PM (#26070207) Homepage

      No, he made a bunch of money because he was there on day one with a ton of press lined up and ready to go and managed (against all odds, IMO) to actually be one of the more decent games at launch. (The prices were a lot higher back then, too, since no one knew how the market would evolve.) He either got lucky or was a marketing genius... The app doesn't sell for $4.99 anymore, either. I'm leaning towards luck.

  • iPhone Darwinism (Score:4, Insightful)

    by actionbastard (1206160) on Wednesday December 10, 2008 @10:14PM (#26069941)
    Code something that is 'insanely great' and you will survive to charge $4.99 for your app. Otherwise, perish in flame.
  • It's a stupid rant (Score:5, Insightful)

    by tkrotchko (124118) * on Wednesday December 10, 2008 @10:16PM (#26069955) Homepage

    It's a stupid rant. Look at the market for PC software.

    There are a lot of *free* applications. Lots. More than I can every use.

    Then there are inexpensive shareware stuff. $5-15

    Then there are the mainstream shareware apps. $40-60

    From there, applications go as high as you want to pay.... $100-500 $1000, $5000

    All are available on the internet. Do free applications limit the abilities of developers to churn out $50 software? Or $100 software? No. People will pay what the software is worth.

    This guy seems to be making the argument that somehow a low price sets the expectation of low prices. It's a dumb argument. If developers come up with an application that's worth $500 guess what... they will pay $500.

    What he's really saying that the $1 applications are so good that he can't compete. And that's probably true. What he needs to do is make his applications worth more than $1. It's not the platform that's holding him back. It's not the price of cheap software holding him back, it's his own inability to write valuable software that commands a premium price. Seriously. Does he even understand that you can't write a general purpose iPhone app and expect to get $50 for it? He's going to have to hit some vertical market software (highly specialized) to command premium dollars. How about a full-blown VST/Softsynth app that will accept plugins for the iPhone? I'd pay $200 for that. How about working with a high-end electronics company to write apps to control lighting/music for home-automation? He could probably get $300-500 for that.

    Just being a good programmer isn't good enough. He should know better.

    Seriously, he's all wet.

    • by c_forq (924234) <forquerc+slash@gmail.com> on Wednesday December 10, 2008 @10:51PM (#26070313)
      To add to your point, I work at a company that uses a wide mix of programs (FOSS and closed source). Our company also staffs over 30 programmers (we are not a software or computer-related company, the programmers just do in-house stuff). There are still programs we pay for that are $3,000+ a seat [plus the worker that runs it, who gets $60,000/yr plus benefits, in the midwest (where the cost of living is WAY lower than the coasts or large cities)]. Something that gets the job done, and done well is worth that.
  • Half truth (Score:5, Informative)

    by cpct0 (558171) <(moc.sianodlehcim) (ta) (todhsals)> on Wednesday December 10, 2008 @10:18PM (#26069981) Homepage Journal

    I'm an iPhone developer. My company have been in the top sellers in US and Canada. And I agree, with some reserve, to what is being written.

    If you look at the games that are produced on the iPhone, they are very good, frankly, many of them have many hours of replay value, many of the apps are top notch, and compared to other phones, they are of insane quality. And for a game that we sell more than $20 on any PC, and even more on consoles, we can only barely nudge a $5 on the iPhone, for nearly the same production quality. That's thousands and thousands of man-hour of work, sold at $5. Think about that. Even then, we got average results: either the comments were raving on our game, either people were giving one star and saying it was way too expensive. That's total bull. And that's what's pissing off people creating solid applications.

    When the iPhone started, some games (like Monkey Ball) were $10. Some productivity apps were $10 to $15. I paid for a few $10 software, and they were with ample merit. Omnifocus is such a tool, real great, well made, even the v1 was excellent. Then, the top sellers became $5 software. Now it's mostly $1 software.

    And that's where I put my grumpy developer shell on the shelf. Frankly, I congratulate $1 games and free games and $1 leisure and productivity tools. They make sure we are not paying $5 like on other phones to get a total piece of crap snorted out by a subcontract firm in 2 weeks. They make sure if we want to pay $5, it's for a good reason. That a software becomes a meme and gets sold by the thousands for 2 weeks and then get replaced by the following meme, I congratulate them. The only reason we are noticing these is because the way the ITMS works "free" and "pay" tops, and nothing else.

    Many good applications cost much more, and hopefully they are getting their own crowd and their own push, with their own publicity. Like on PC with freewares and sharewares and commercial software, you pay mostly by merit.

    • Re:Half truth (Score:4, Insightful)

      by Kent Recal (714863) on Wednesday December 10, 2008 @11:19PM (#26070533)

      I don't get the whining. You can whine about apple banning apps that they don't like but whining about pricing? C'mon it's a free market (unless you step on apple's toes) and it works like every other market: People buy what gets the job done for as cheap as they can get.

      If you build a top notch app that people want and that has no competition then it will most certainly sell for $5, maybe even for $10 or $50.

    • merit (Score:4, Interesting)

      by Gary W. Longsine (124661) on Wednesday December 10, 2008 @11:27PM (#26070625) Homepage Journal
      My company, illumineX, makes a blogging client for the iPhone, iBlogger. There are a dozen competitors, most of them are free. We charge $9.99. We are told that it's one of the most expensive apps on the store. We're also told that it's one of the most complex (blogging client apps are surprising complex, if they support more than one blog type). Many of our customers used most or all of the other applications, first, and were happy to pay for iBlogger, because they feel it's worth the price. Are we making enough money to justify the work that it took to make the app? Not even close. Are we going to lower the price? Well, one of our few competitors who charged money lowered their price for a month. It went back up. Why? I'm gonna guess that sales didn't go up much, and tech support costs went way, way up.

      Apple's long term success may not depend on complex apps being available. If it does, however, then there are serious problems with the iTunes App Store market.
  • by fuzzyfuzzyfungus (1223518) on Wednesday December 10, 2008 @10:22PM (#26070027) Journal
    Sure, having to compete with el-cheapo apps isn't anybody's idea of fun; but I find it very odd that their presence would act against complex apps. If the simple stuff is a mass of cheap and/or free, then the profit motive will lead developers to try to build products that distinguish themselves from the mass and can command a higher price(or, y'know, lobby for new laws, RIAA style).

    Rather than "OMG cheap competition!" I'd be inclined to suspect a couple of things: First and foremost: Uncertainty over App store approval rules. Apple can, and sometimes does, just yank the rug out from under an app during the approval process. The rules are underdetermined and don't seem to be followed terribly consistently, and there is no real appeal. This is Apple's right, legally speaking; but is it any huge surprise that people are not rushing to make large investments in highly complex products?
    Secondly, cellphones, even nice ones, are mediocre platforms for big highly complex stuff. Apple has done a substantially better job than usual; but nothing(presently available) can really disguise the fact that you are working on a tiny screen, with very limited input options.

    Somehow, those terrible, terrible, innovation killing people who give software away have failed to destroy large, complex applications on the PC, I strongly doubt that they are managing that here.
  • by AceofSpades19 (1107875) on Wednesday December 10, 2008 @10:27PM (#26070077)
    Is this "Please give me a bail out because I can't figure out how to compete" week on slashdot?
  • by olddotter (638430) on Wednesday December 10, 2008 @11:00PM (#26070401) Homepage

    How is this different from other for pay software? I walk into a store and buy shrink wrapped software and 99% of the time I can't return it if I've opened it, much less decided I don't like it. They need something called MARKETING. And all they want is free marketing on the itunes store, but word of mouth or actual ads might work as well or better.

    Would a digg like site for the app store help?

  • by OrangeTide (124937) on Wednesday December 10, 2008 @11:04PM (#26070427) Homepage Journal

    I think it would be far more interesting to list apps by highest price. If someone wants $1-$2 for a puzzle game, that's cheap. But not crazy, I suppose.

    But if you were selling something more substantial, like many of the utility apps seen on Palm (databases, pdf viewers, word processors, spread sheets, electronic checkbooks, etc). I don't see why people wouldn't fork out $10 for it. Obviously in smaller numbers, because that $1 price barrier is soo easy.

    Are people really buying 10 games/ringtones instead of 1 power app that offers something important? I find it hard to believe.

    Apps that I would like to see, that could be worth something:
    * Spending program, you can take a picture of your paper receipt and it logs the total(using simple OCR) and the time. And then lets you organize the data in powerful ways.
    * Generic Inventory Database, store lists of any old thing. the obvious DVD library, CD library, etc has been done to death. Being able to track inventory of any widget with custom fields would be great. How many ming vases do I have with jade? I should be able to list them all immediately and include photos.
    * Password keychain
    * RSA SecurID softtoken - turn your iphone into a securid fob. get rid of that little keychain you need to log into your work's VPN. (this is indeed possible, I had them for other OSes)

    (I'm tired of coming up with examples, but I think there are 20-30 solid utility apps that were done in one form or another for PalmOS that I haven't seen yet on iPhone)

  • by Tjp($)pjT (266360) on Wednesday December 10, 2008 @11:30PM (#26070669)
    I have 4 programs for the iPhone on the App Store. They are $1.99 for all but one which is $0.99. I paid a graphics artist $1000 (actually a split of the first $5000 of sales, little did either of us guess) and I spent an average of about 3 weeks per app. The two word oriented games have huge dictionaries in Spanish, Russian and English. So far my net payments from Apple are no stellar, well under $1000. The reasons... 10,000 other apps. The jockeying for the current release spots. (we have had issues on 2 of the four that buried them 4 pages in on current releases so no great buzz...) and a whole bunch of imitators that follow on with limited functionality knock-offs for free or 99 cents. Not to mention the competitors who on day one would give a bad review which just kills sales. Even though they didn't buy a copy. That is corrected now. My competitors will at least have to pay all of $2 to say my app crashes on startup. (It won't get through Apple screening if it does that, well, anymore)...

    So professional developers will just not be able, as the co-sympathizer over at Icon Factory notes, be able to put the effort into really feature-full apps. And they at least have a decent marketing engine behind them. They can get sales over 100,000 for each app. I am hoping to get something like 3-5000 in sales for each app.

    Apple just makes it hard for me to have an independent sales effort as well. I had a major chain store's buyer interested in having my App(s) for sale in their store. I wrote Apple a nice letter pointing out the issues. And they acted on the portion suggesting a promo code so I could get reviews but have so far rejected things like selling me a code for the app at their cut of the purchase price, so I can do things like sell it myself to brick and mortar stores. Create my own storefront online to increase the sales of my App(s) without Apple recommending my competitors products at checkout, and so on. And on. And on.

    So yes. Great for the iPhone user. There are a lot of applications that are free or well under $5 most hovering at either 99 cents or $1.99. And before you say anything derogatory about paid software will sell if its good and so on, people buying games will take a free version if it is just for minor diversions and live with the limitations instead of a paid version, and for some of us programming is not an avocation, its the way we pay rent and put food on the table.
  • by Bob9113 (14996) on Thursday December 11, 2008 @01:13AM (#26071391) Homepage

    Hockenberry is a former developer turned business owner.

    His complaints seem to stem from three things:
    1. Developers are selling cheap straight to the customer.
    2. Developers charge too much for him to be guaranteed a profit from their labor.
    3. These cheap apps don't reflect his ideals of a good application.

    Could this be a microcosmic view of a sea change that is at our doorstep? Software engineers, labor, can now sell directly to the customer - and the product reflects "scratching an itch" simplicity. Corporations like Hockenberry's take a share of the income and add a certain level of quality control and interface polish. The customer has the power of the purse - and is choosing the discount route buying directly from the developer.

    There is an advantage to being the low-price competitor, but such is the free market. It seems a more fundamental question is being raised by this market demonstration: Is the corporation adding sufficient value to the products that software engineers create to justify its piece of the action?

    Over the past 30 years, the wealth-creation potential of knowledge workers has exploded. No longer the single-buyer creations of the factory worker, 21st century labor creates infinitely reproducible information products. The products themselves have seen an unprecedented rate of advance from the black and white blobs and monospace text of 20 years ago to the fledgling storefront websites 10 years ago to today's globally connected life utilities.

    During the same period, wealth has been concentrating with executive management (see income distribution, 1970 to present). The 90th to 95th percentile of income, largely the range software engineers occupy, has seen its income remain flat relative to GDP. Meanwhile, the top 0.1% has seen its share of GDP increase by about 6x (see Piketty Saez 2007).

    Another point to consider is advertising. The corporation, which uses advertising to create a perception of value (sometimes justified, sometimes not), has not yet figured out this new market. The market is acting without the benefit of the siren song (for better and for worse).

    Interesting data points, those:
    1. Over the past 30 years, the wealth creation potential of knowledge workers has been on a meteoric climb.
    2. In that same time, the income of the pay bracket those knowledge workers occupy has stagnated - while that of corporate senior officials has risen by a factor of 6.
    3. The distorting effect of advertising has not yet reached this particular market.
    4. Customers are foregoing corporate products in favor of buying direct from the software engineer at a discount price.
    5. A representative of the corporation, the traditional bearer of risk in ventures, is complaining that he cannot be guaranteed a profit.

    Seems to me there may be a force other than foolhardy consumers at play here.

  • Trial versions (Score:4, Insightful)

    by sc00ch (254070) on Thursday December 11, 2008 @07:19AM (#26073253)

    For me its inability for developers to offer trial versions of apps using the App store. I'm not going to pay more than a few bucks for something i cant try before i buy. Screenshots and reviews just dont cut it for me, so how about Apple allows developers to do x Day trials. I'm sure its possible!

    • Re:Trial versions (Score:4, Interesting)

      by FictionPimp (712802) on Thursday December 11, 2008 @08:06AM (#26073561) Homepage

      A good work around for this is already being done. So developers offer a free version and a paid version. IM+ for example. They have a free version with a few key features removed. If you like it you can buy the paid version.

      I didn't like it so I didn't buy it. A few games do the same thing. For example spore.

      I still don't understand the argument however. Are they saying that apple should ban cheap software so they no longer need to compete? Or that people will not consider higher priced software even if there is no cheaper competitor simply because everything else is cheaper? Seems to me they just need to suck it up and compete.

  • by thepacketmaster (574632) on Thursday December 11, 2008 @07:44AM (#26073401) Homepage Journal
    Not many people are going to by a complex application for a platform that they may not choose to keep. Buying for a workstation is one thing, but people change cell phones a lot more than they choose their workstation. Also, the iPhone, for all its hype, has some severe limitations (no Java, no Flash, no cut-and-paste). Add to that the possibility that some new and sexier mobile phone is always around the corner and could have a completely different architecture that won't run these iPhone applications, and that leaves people with the idea that buying an expensive application might be a waste of time and money.
  • by iElucidate (67873) on Thursday December 11, 2008 @10:27AM (#26075267) Homepage

    I think most commenters are missing the primary focus of the author's rant. This is fair, because his letter is laden with subtext that is probably not obvious to people who aren't intimately familiar with the iPhone developer community. I believe that the primary thrust of his argument is not that he should be paid more, or that his apps can't stand on their merits, or that he is no longer in a position to play gatekeeper.

    Rather, his primary complaints seem to be with the Apple-approved and required distribution mechanism for the iPhone, namely their App Store. The App Store severely limits how apps can be sold, promoted, and used. It does not allow for trial software, it does not allow for returns. There is no built-in help system or feedback mechanism. Ratings cannot be challenged. And the "top X apps" is segregated by "free" vs "pay" but not by different levels of pay. Therefore it is much easier to sell more copies of a $0.99 app and climb the charts, displacing potentially far better but more expensive apps that are naturally going to have fewer sales.

    Hockenberry's letter seems aimed at encouraging or nudging in the direction of fixing many of these perceived App Store deficiencies. That is why it is addressed to Steve Jobs, and not to other developers. He isn't saying "stop selling your $0.99 apps," he's saying, give all app developers a fair playing field to encourage innovation and risk-taking.

  • Killer App? (Score:3, Insightful)

    by greg_barton (5551) <greg_barton@ya[ ].com ['hoo' in gap]> on Thursday December 11, 2008 @12:04PM (#26076823) Homepage Journal

    ...the iPhone may never get its killer app like the spreadsheet...

    The app store IS the killer app.

  • by caywen (942955) on Thursday December 11, 2008 @02:38PM (#26079453)
    I'm days away from releasing my game on AppStore, and all the while during development, I watched prices plummet. Very disheartening and demotivating. This happens initially with any open market system, and the thing that needs to fundamentally change is not the system, but expectations. Too many iPhone developers go into this thinking they'll be the next Trism and Ocarina. That's fine, but you'll probably also dive deep into disappointment, which turns to anger, and then to finger pointing. Get your expectations straight, and you'll do yourself less emotional damage. Something developers are also missing is how many people out there actually have the right expectations. A lot of devs do their apps because it's cool and they are fascinated with making software, beyond the money aspect. That's where the $.99 toys come from. They are the stones that devs with dollar signs in their eyes are cast upon. Forget trying to make your living on AppStore alone. You'll always hear about the few who made it huge, and the rest of us who are satisfied that we made something cool and where the income is all extra. It sucks, but if you want a higher chance of making it rich, either join a startup with stock options, or be the best. In other words, from here on in, you'll only make your living on AppStore if you are absolutely phenomenal, or phenomenally lucky. Otherwise, be in it for the fun of it.
  • by recharged95 (782975) on Thursday December 11, 2008 @04:35PM (#26081693) Journal
    I wonder what would have happened if they charged for ActiveSync (as an App) similar to the Google Market (i.e. some 3rd party apps, i.e. for MS exchange, go for $30). That would have opened the door.

    iphone apps are pretty much stuck with $0.99 since Apple users are loyal followers such that a. it's the same paradigm as the itunes store (0.99 songs), it's all managed through itunes, and the current thousands of apps are less than $3 so the bar has been set.

  • Clearly... (Score:3, Funny)

    by roc97007 (608802) on Thursday December 11, 2008 @05:10PM (#26082317) Journal

    Once again, the obvious solution is to forbid developers from working too cheaply. I mean, how can I demand a high price for my complex, quirky app when someone else has the audacity to produce a better app for 99 cents? Sowing "you get what you pay for" FUD only works so far.

    I'm thinking a software developers union. The union bosses would set prices, and consumers would be forbidden from using non-union-approved apps, on penalty of high fines or, you know, getting your kneecaps busted. In no time prices would soar, and we'd all get the full benefit of our efforts. Minus union dues and other applicable fees, of course.

    And another thing. Software development tools have become way too cheap. When any pimple-faced geek can download a complete development environment for free, it gives them the impression that anyone can write useful programs. Compilers, debuggers and editors should be expensive, dammit, just like they were in the old days. And have fiddly license requirements. Software development should hurt so everyone knows why we're getting paid top dollar to do it.

    Consumers? Hell, if they can't afford $79.95 for a fuel efficiency calculator, they can jolly well do without. They should be happy that their phone works as a phone.

  • by glyph42 (315631) on Thursday December 11, 2008 @08:42PM (#26085145) Homepage Journal

    I'm sorry, what? Are they complaining that it's hard to make money because there is competition? Hahahahaha. HAHAHAhahahahaha.

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