A novel idea to generate higher quality (higher cost) apps.

[Mad Mac Maniac]

One area that has been critizised about the app store is that "race to the bottom" mentality. Apps need to cost under 5 bucks to be really successful. This means we don't get apps or games that are as high of quality as computer apps and console games, because there just isn't the incentive for the devs to create them. Now with the release of the Mac app store this has been drawn under more scrutiny wondering if it will be the same. Well in under 30 seconds I have devised a simplistic approach to how Apple can drive more innovation by driving incentive for higher paying apps.

The more expensive your app is, the higher your share of the revenue split is. All apps now have the 70/30 split. 70% to devs and 30% to apple. Well maybe if your app cost >= 9.99 it would be a 80/20 split. or >= 19.99 a 90/10 split, or >=39.99 a 95/5 split.

Those are just rough, randomly picked numbers. I'm sure Apple could create something more scientific. Maybe instead of tiered it would be gradual. Like every $1 above $9.99 the dev would recieve an extra 1% (not to exceed 95% or something). This would be better I think because it would create more competative pricing instead of just sticking to those predetermined levels.

I know this would cause apple to give up revenue but if they want to develop a proper culture of high quality games/apps then I think this is needed. Especially because Apple claims they only charge the 30% to maintain the app store not for revenue. Well every .99 app gives them .33 while every 49.99 app gives them 15.00, but they both should cost the same to apple in overhead...

Anyone think this would be a good idea? I should work at Apple huh?

 

[triptyx]

The market will support the price that it will support, regardless of the revenue "benefits" you try to generate. Trying to artificially affect prices usually backfires.

Does raising the price of an app actually make that app better? Perhaps the argument is that if a developer thinks he can get $5 or even $10 per copy he/she will spend more time developing a higher quality, larger content app. But really, what you're dealing with is the attitude/culture of the dev or company, the propensity of a consumer to pay $x, and the marketing/creativity/desirability of the app itself.

Would tons and tons of people have purchased Angry Birds if it was $4 instead of $1? Would the developers have seen any more or less revenue (even with your proposed scaled revenue stream) from a price increase? Personally, even though I enjoy it, I probably would not have made the jump to purchasing it at all if it was $4.

Ultimately, it takes more market research than "hey, this is a great idea no?" to figure out if you can succeed with a scheme like this. I'm assuming Apple has considered similar ideas and discarded them for various informed reasons. Perhaps they haven't and your post will cause them to research the intended and unintended results of such an idea.

 

[kas23]

Great, so developers will just raise the price of their crappy apps in order to get a higher share.

 

[Mad Mac Maniac]

Would tons and tons of people have purchased Angry Birds if it was $4 instead of $1? Would the developers have seen any more or less revenue (even with your proposed scaled revenue stream) from a price increase? Personally, even though I enjoy it, I probably would not have made the jump to purchasing it at all if it was $4.

No no, but I'm not talking about raising the price of apps just to raise them. And if you noticed on my post I'm really more concerned with the above $10 apps. all below that would still get 30%. but how many apps are above $10 on the app store? I have no statistics handy, but I'd guess less than 5% easy, and probably less than 1% when factoring in the free apps.

Look at games. The max price out there for games $10 (with maybe a couple exceptions). Is this because people with iOS devices are unwilling to pay more than $10 for a game? If so than my idea is definitely flawed. But I'm willing to bet that many of iOS device owners also own a PSP or a DS or whatever and pay $30-$40 for games. So why wouldn't they buy a $20 football game. or a $30 shooting game? The principle behind my proposition depends on the fact that the conclusion is iOS doesn't have a high enough quality of games. Why? because the incentive isn't there. People aren't creating that quality of games, because the market has decided that $10 is the highest people will pay. I disagree. I think that if incentive was given to the devs many high quality games in the $20-$30 range will appear and this will create a trend counter to the current trend of sub-$10 apps.

Perhaps they haven't and your post will cause them to research the intended and unintended results of such an idea.

haha thanks! I know this will be the case!

 

[Mad Mac Maniac]

Great, so developers will just raise the price of their crappy apps in order to get a higher share.

No because the $1-$9 apps would have the same 70/30 split. if a dev raises his $2 crappy app to > $10 then that dev will fail miserably....

 

[Demosthenes X]

the market has decided that $10 is the highest people will pay.

This is the crux of why your plan will fail. The problem isn't a lack of quality apps. It's that people are unwilling to change their minds about app pricing.

If you want to see more higher-priced apps sell, you need to change consumer thinking, not the apps.

 

[tigress666]

This is the crux of why your plan will fail. The problem isn't a lack of quality apps. It's that people are unwilling to change their minds about app pricing.

If you want to see more higher-priced apps sell, you need to change consumer thinking, not the apps.

Exactly. I'll use myself as an example.

I know there are a few apps I am still thinking about but the thing that keeps me from buying them is the 10 or more dollar price (in my opinion you are seeing more apps being priced more expensively).

Games from big publishers like Squaresoft (I love their rpgs, and yet I can't get myself to pay 10 or more dollars for an iphone game).

 

[logitechFan]

This is the crux of why your plan will fail. The problem isn't a lack of quality apps. It's that people are unwilling to change their minds about app pricing.

If you want to see more higher-priced apps sell, you need to change consumer thinking, not the apps.

I totally agree. The most I spent on a game is just below 2 dollars. I know tons of people who only download free games.

 

[Razeus]

One area that has been critizised about the app store is that "race to the bottom" mentality. Apps need to cost under 5 bucks to be really successful. This means we don't get apps or games that are as high of quality as computer apps and console games, because there just isn't the incentive for the devs to create them. Now with the release of the Mac app store this has been drawn under more scrutiny wondering if it will be the same. Well in under 30 seconds I have devised a simplistic approach to how Apple can drive more innovation by driving incentive for higher paying apps.

The more expensive your app is, the higher your share of the revenue split is. All apps now have the 70/30 split. 70% to devs and 30% to apple. Well maybe if your app cost >= 9.99 it would be a 80/20 split. or >= 19.99 a 90/10 split, or >=39.99 a 95/5 split.

Those are just rough, randomly picked numbers. I'm sure Apple could create something more scientific. Maybe instead of tiered it would be gradual. Like every $1 above $9.99 the dev would recieve an extra 1% (not to exceed 95% or something). This would be better I think because it would create more competative pricing instead of just sticking to those predetermined levels.

I know this would cause apple to give up revenue but if they want to develop a proper culture of high quality games/apps then I think this is needed. Especially because Apple claims they only charge the 30% to maintain the app store not for revenue. Well every .99 app gives them .33 while every 49.99 app gives them 15.00, but they both should cost the same to apple in overhead...

Anyone think this would be a good idea? I should work at Apple huh?

Someone needs a lesson in basic economics.