Comments on: iPhone application price points and business models

By: Predictions For Casual Games In 2009 | Product Management Meets Pop Culture

Predictions For Casual Games In 2009 | Product Management Meets Pop Culture — Sun, 21 Dec 2008 20:42:18 +0000

[...] iPhone Application Price Points And Business Models [...]

By: iPhone native Apps - the great leap backwards? | Web Directions

iPhone native Apps - the great leap backwards? | Web Directions — Sun, 20 Jul 2008 22:48:56 +0000

[...] So, are there any arguments in favor of developing native apps for the iPhone? Well, arguably, there’s the whole issue of business models. People, we are often told, don’t buy web applications, but they do buy desktop apps, and so by extension will buy native iPhone apps. So there’s a ready made business model there. In fact, being able to charge for your apps is one of the key points of interest for many developers. [...]

By: greg

greg — Fri, 20 Jun 2008 12:09:46 +0000

Alex – I suppose anything’s possible, but we think that’s an extremely slim possibility at best. Apple’s too close to the iFund, which has publicly talked about advertising on too many occasions.

The question of whether Apple would allow a distributed-for-free application to make significant money through other means without getting its own cut (for the serving costs) is an interesting one which simply can’t be answered now – it’ll only be resolved in time.

By: Alex

Alex — Fri, 20 Jun 2008 06:37:12 +0000

I don’t think Apple will let you charge outside their app store system since they won’t be getting their 30%, so adverts and subscriptions are out.

By: Tom

Tom — Thu, 19 Jun 2008 18:58:10 +0000

I think as the market matures, you’re going to find the race to the bottom price as you described. However, there will always be a market for applications that deliver value, even when comparable applications might be available for free. I think developers should be wary about underpricing their applications just because they think someone else could provide it for free. I have written an article about the dangers of underpricing your iPhone app if you’re interested. http://www.IPHONEAPPENTREPRENEUR.COM/2008/06/the-dangers-of-under-pricing-your-iphone-application.html

By: Tom

Tom — Thu, 19 Jun 2008 18:54:02 +0000

I think you covered them all, although I would add that the subscription model would also include paying for information, not the application. For example, the application is free, but the information delivered to you costs money. Think Wall Street Journal App, where the news is delivered to you formatted to your phone, with search, updates, video, etc delivered via a native app. You pay for a WSJ subscription, not to use the app. This eliminates the necessity to enter a code in the application to keep it running or to get Apple’s approval. Either you’re paid up or you’re not, all the app does is check and then deliver info.

By: David Rangel

David Rangel — Thu, 19 Jun 2008 02:32:07 +0000

This is a good post. I fully agree with your rationale – for most apps (especially consumer), advertising is the way to go. Subscription or up-front charge may work for some business apps (and I think we will see many of these as well).

Virtual goods has the potential to be big – but the big question there is if Apple will allow it. It’s a way to go around their fee and still get hosting and bandwidth for free.

One key for you will be getting the right ad standards in place. That may prove difficult since client apps have the potential to all be very different (unlike web sites where everyone has eventually moved to the same set of banners). Some apps may be ok with a banner, others will want some sort of interstitial, etc. etc.

Another interesting option for developers may be sponsorships. Its still an ad, but not really one they can go through a network for.

You guys are on to something very interesting. Looking forward to seeing more.