> The economic reality is that most apps offer next to no value to people.
I'm not an app developer and I disagree that most apps provide next to no value (some apps, like everything else sure, but many of them do provide more value than their price).
For example there are many games priced $0.99 or $1.99 that people might play for hours and hours. Shouldn't that cost more?
The reason that the prices are low is not because people are not prepared to pay for them. It's because Google and Apple want it that way and also because developers are slashing prices to the extreme to compete.
Imagine if App store and Play store didn't exist and you'd have to individually find developers and buy/download their apps. That would certainly result in higher prices.
The bottom line is app developers have no one to blame but themselves for creating this perception about their apps and allowing this expectation of $0.99 apps to grow.
People also have no freaking clue how hard it is to make apps. For example most people think mobile apps are a lot easier to make than software/web apps, perhaps because mobile devices are 'small' so they tend to think of mobile apps as 'tiny' little widgets that someone pushes 20 buttons and it magically gets created.
If a large enough group of people start raising awareness and refusing to release their work for peanuts we'll see a shift in the market price towards more realistic numbers.
I think your comment is an example of exactly the sentiment this blog is trying to address: Complaining into a void. Users should value what you want them to value. Apple & Google should fix it.
The reality is that Apple & Google have their interests driving them, user have theirs & App developers have their own. Anyone who finds themselves frustrated and complaining into a void needs to channel the stoics and devote their emotional energy to stuff that can be changed, preferably by them.
That said, I don't quite agree with his approach. The price of a cup of coffee is not a good benchmark unless you happen to be selling tea or biscuits or something else in the coffee shop. The Cup of Coffee is a little anomaly involving self esteem, addictive substances, morning routines and other bits and pieces of dark magic. Every environment has its own price dynamics and very few are similar at all to coffee shops'. In a supermarket people are very cost sensitive. An extra 30¢ can be the difference between customers choosing one jar of instant coffee over another. That's less than one cent per cup of coffee. Enough with the cup of coffee already. If it helps you make a sale, go for it. If you are using cups of coffee to justify to yourself why people should be buying your stuff when they are not, don't.
There is a chasm between $0 and $0.01 for digital goods that is confusing but undeniably there. Yelling at it that it shouldn't be there and holding up your overpriced cup of coffee as proof that selling stuff should be easier is useless.
It's hard to sell software with a value anywhere in the ballpark of a cup of coffee regardless of price. That is reality. It was hard before the App store. It's still hard. It's also hard to sell (ppv) episodes of Breaking Bad (even though they're awesome), digital subscriptions to newspapers (even though the paper versions were clearly worth something to some people). We can discuss why the experience of buying software or TV shows isn't as rewarding as the experience of buying coffee, but lets not try to argue that it is or should be when it clearly isn't.
Coffee has its own culture and rituals around it. Some people tend to be snobby (for lack of a better word) about coffee. Our office provides free coffee, but lots of people bring in their own coffee shop coffee at a cost of a few bucks a day. Sitting in a coffee shop is kinda a "thing" to do, even though you can make coffee at home and sit in your living room for pennies. People hang out there, do work, read, what have you.
I imagine Apple and Google are largely indifferent. Low price points make their platform more attractive. Higher price points, make them more money.
It's just competition. The barrier to entry is incredibly low (lower than it's ever been on desktop, because billing and distribution is done for you), and now it's a race to the bottom.
I think that applies to Google/Samsung/Amazon, who want to capture as much of the market as they can get.
Not sure it applies to Apple. They've made their position on the low/mid-range clear. If anything, having an App Store full of shovelware makes it harder to distinguish iOS from Android, which is what they've bet the company on being able to do.
>If anything, having an App Store full of shovelware makes it harder to distinguish iOS from Android
But app stores full of crap provides easily reguritable marketing nuggets that make your platform seem more robust and put potential competitors in a bad light. "ZOMG we have 1,000,000 apps!" Try posting about Windows Phone or Blackberry and prepare to be ridiculed for talking about platforms with "only" a few hundred thousand apps.
Prices are not low because of Apple or Google, they are low for exactly the reasons in the article plus one, they are so many apps its just as likely you will find an acceptable one that is free that does what another wants money for.
I have purchased a few apps, namely ones I was familiar with on my desktop and wanted a portable version of. Yet for nearly every paid "other" app I could find one or more free ones.
the idea of finding a "large enough group" to correct pricing is laughable, go for it, the ease of development is that ideas undoing. Yeah, it does not guarantee good apps, but that old adage about a million monkeys and Shakespeare applies here too
I have my doubts that prices are going anywhere but down. You can stubbornly keep your app's price high if you want but a couple of dozen others will gladly step in your place.
I think the author is wrong here; apps do offer real value but they are still close to being worthless economically. What developers should start realizing is they shouldn't spend so much effort on todo lists, podcast clients, rss readers, or any other trivial app category that many people do as side projects for free for fun.
As a result we might get more genuinely innovative apps as developers look more closely at what niches are being underserved.
Exactly. If you can't build something unique then don't complain if there are 100 other developers (some of whom may come from developing countries) who are happy to do for it less.
There is a new era of apps being ushered in as a result of Bluetooth LE. Take advantage of it.
As Arment notes, there's no way you can build something unique unless 1. you've got dedicated hardware (in which case you'll sell the hardware and give away the application) or 2. it's a small niche market through which you can stay under the radar of price dumpers
But there are nearly infinite numbers of "small niche markets", many of which are willing to pay a lot of money because in their case the app provides enormous value.
There are a lot of small niche markets, but I am not convinced that they'll generate much revenue because--hey, it's still just an app, why does it cost so much?
If the only way to do anything in mobile is to constantly be outrunning the onrushing boulder of the shitty free knockoffs, it probably makes more sense to just go do something else. (This is where I'm at now; there are no good applications for a number of things I really want, but there's also no way to recoup the time investment of making one just so you can get one-star reviews for "$5 is too expensive".)
Some developers are willing to sell for $1, and make quite a bit of profit because that brings in lots of customers. Why "shouldn't" they do that?
Imagine if App store and Play store didn't exist and you'd have to individually find developers and buy/download their apps. That would certainly result in higher prices.
So you're saying that Apple and Google are providing most of the value here. Maybe they "should" be getting 90% of the revenue instead of 30%.
People also have no freaking clue how hard it is to make apps.
It's hard to make microprocessors. Should Intel and ARM make an agreement to triple their prices so that their engineers can be properly rewarded?
If a large enough group of people start raising awareness and refusing to release their work for peanuts
As a cell phone customer in the US I appreciate price-fixing cartels as much as anyone. But first you should really do something about those open source communists who have been devaluing software development for decades.
> So you're saying that Apple and Google are providing most of the value here. Maybe they "should" be getting 90% of the revenue instead of 30%.
Maybe they already are. Another way to think about this might be, apps might nominally cost $20 or so, and Apple/Google do take 90% -- but they also choose to give an (invisible, constant) 80% discount to encourage purchases. Developers then get paid from net, rather than gross, profits.
I fail to see where they have had any influence. Apple at least has historically priced a number of their applications pretty high (not all of them though, basically "core feature" applications such as ibooks or podcasts were free, but iwork applications are $10 each, and garageband and imovie are $5)
> also because developers are slashing prices to the extreme to compete.
Mostly that one, from very early on there's been an insane tendency to price-dump and race to the bottom.
> That would certainly result in higher prices.
It would also result in extremely low sales, as known by anyone who developed for S60 or Blackberry back in the bad old days.
> If a large enough group of people start raising awareness and refusing to release their work for peanuts we'll see a shift in the market price towards more realistic numbers.
That's completely unrealistic. It would require a buy-in from every single developer.
> Apple at least has historically priced a number of their applications pretty high
This is incorrect. Apple has historically priced their software very low, and their hardware very high. Their office suite is very inexpensive compared to MS Office, for instance. Their OS is also very inexpensive compare to Windows.
On the mobile side, their $5 and $10 price points make it hard for others to justify charging that much for less complex software (a point corresation has also made).
Now of course they are giving away their mobile software, which I think helps both themselves and 3rd party developers, so I think it's one of the few steps they've taken to help 3rd party developers charge more. (Last time around it was the creation of a "premium" category.)
but iwork applications are $10 each, and garageband and imovie are $5
These are enormously complex, rich applications that supplant historic applications costing hundreds of dollars. If Garageband is $5, it makes it that much more difficult for anyone not making a significant application with a team of developers to demonstrate value for a couple of dollars.
> If a large enough group of people start raising awareness and refusing to release their work for peanuts we'll see a shift in the market price towards more realistic numbers.
This is always the dream of the producer whose output is "underpriced", whether he's a laborer or capitalist.
"If we all band together and restrict supply, we can force prices up." But if someone breaks rank, our cartel collapses.
There have been at least temporary successes: trade unions, the Steel Trust, OPEC.
_Imagine if App store and Play store didn't exist and you'd have to individually find developers and buy/download their apps. That would certainly result in higher prices._
Higher prices .. and much, much lower sales.
The analogous situation is developing with PC games and Steam; rather than spending £40 each on a very small number of games I find myself spending £4 - £15 on a large number of games.
Some sort of ridiculous Galtian producer's strike will get you nowhere here. People have plenty of other choices.
I'm not an app developer and I disagree that most apps provide next to no value (some apps, like everything else sure, but many of them do provide more value than their price).
For example there are many games priced $0.99 or $1.99 that people might play for hours and hours. Shouldn't that cost more?
The reason that the prices are low is not because people are not prepared to pay for them. It's because Google and Apple want it that way and also because developers are slashing prices to the extreme to compete.
Imagine if App store and Play store didn't exist and you'd have to individually find developers and buy/download their apps. That would certainly result in higher prices.
The bottom line is app developers have no one to blame but themselves for creating this perception about their apps and allowing this expectation of $0.99 apps to grow.
People also have no freaking clue how hard it is to make apps. For example most people think mobile apps are a lot easier to make than software/web apps, perhaps because mobile devices are 'small' so they tend to think of mobile apps as 'tiny' little widgets that someone pushes 20 buttons and it magically gets created.
If a large enough group of people start raising awareness and refusing to release their work for peanuts we'll see a shift in the market price towards more realistic numbers.