How much would you be willing to pay for a third party app?

The Apple

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#1
I was just thinking to myself how disappointed I would be if some really nice third party apps came out and ended up costing too much money to download. I wouldn't be too concerned about anything under $15-$20. Anyone else here have any thoughts?
 

KNK

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#2
I am going to be paying $28 for the voicedial app when the free trial is over, it is well worth it and works great when driving. double tap home and say a name...bam.
 

patrickj

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#3
Really good question.

Like many here, I've been buying (too many) Palm and Windows Mobile apps for years. $10-20 for a good, useful or big fun app is fine. On more rare occasions, I'd pay $30-40 if an app is really something special or fulfills a big need (I used one for time tracking billable hours on consultancy work that was very heavyweight etc.). I don't remember being very tempted to go above $40 ...
 

Ezekiel2517

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#4
it really pretty much depends on what the app is. like if its something that i really need or is very useful, i'll proabably still buy it even its overpriced. :laugh2:
 

x666x

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#6
We need to consider a couple things about this model, and thats the market saturation of the target platform. With that in mind you can lower your price points and make a profit off bulk.

Apps should not cost more than 4.99-9.99 depending on the complexity of their design.

A game or simply todo-list should only run 4.99, however if we're talking about something like a Quicken app that also has to install conduits in iTunes to communicate with a local Quicken database, then we're looking at an app that would run around 9.99 due to the amount of work involved to maintain a working product across the board.
 

patrickj

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#7
We need to consider a couple things about this model, and thats the market saturation of the target platform. With that in mind you can lower your price points and make a profit off bulk.

Apps should not cost more than 4.99-9.99 depending on the complexity of their design.

A game or simply todo-list should only run 4.99, however if we're talking about something like a Quicken app that also has to install conduits in iTunes to communicate with a local Quicken database, then we're looking at an app that would run around 9.99 due to the amount of work involved to maintain a working product across the board.
I don't think that's realistic right now. Not sure what you're meaning on market saturation, but if you mean current number of iPhones out there in the market, then even with the great momentum iPhone has, you still are working with a much smaller existing user base than on Windows Mobile or Blackberry, or Symbian - and even with the much larger volume on those platforms, there are tons of apps that sell for more than $10.

I think there will be plenty of iPhone apps that cost above $10 as well.
 

x666x

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#8
I don't think that's realistic right now. Not sure what you're meaning on market saturation, but if you mean current number of iPhones out there in the market, then even with the great momentum iPhone has, you still are working with a much smaller existing user base than on Windows Mobile or Blackberry, or Symbian - and even with the much larger volume on those platforms, there are tons of apps that sell for more than $10.

I think there will be plenty of iPhone apps that cost above $10 as well.
I think its very realistic.

1) This is Apple, not some offshore startup with a lot of investment capital to blow on a hit-or-miss model before they cut-and-run

2) Are you up to date on the amount of iPhones that are in distribution worldwide, and what the new marketshares look like? Sprint is laying off people and closing stores if that says anything, and of the market shares, the iPhone is doing better than the bottom 3 competitors combined. Not bad for just it's first year.

3) The phones you've listed and the businesss models for which they distribute their software isn't iTunes. They're not as easy to use as iTunes, and the distribution package isn't something most people already have on their desktops to tether their iPods to.

4) Brand name Convergence and product cohesion. Of all the phones you've listed, none of them have any of this going for them, except for the reputation RIM has with it's Blackberry. Even in that case, I can't hook my Blackberry up to my desktop and move my iPod movies over to it and vice versa. Being able to do more with your hardware when its matched with products from the same family is a huge deal maker for many users. The notion that I can do more with my applications provided they're on the parent platform, in most cases, is a huge plus, especially if that means I'll be sharing data with other devices under the same umbrella. This might not be the norm on PC, but it sure is on the Mac, and thats another plus for the iPhone in that sense.

---

Based off volume alone, theres no reason Apps should ever go above $9.99, we're not buying a full suite here, we're buying mobile applications to access information we'd otherwise have to use a desktop for, we're not going to be designing Ads in a mobile photoshop, or debugging code and compiling web apis on it either. This is a scaled down medium who's price points should be in line to match this.
 

patrickj

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#9
1) This is Apple, not some offshore startup with a lot of investment capital to blow on a hit-or-miss model before they cut-and-run
OK, which offshore startup is the point of comparison here? I mentioned Windows Mobile, Blackberry etc - which are run by huge, multinational firms with huge resources. Not sure what relevance that point has at all.

2) Are you up to date on the amount of iPhones that are in distribution worldwide, and what the new marketshares look like? Sprint is laying off people and closing stores if that says anything, and of the market shares, the iPhone is doing better than the bottom 3 competitors combined. Not bad for just it's first year.
Yeah, I believe Steve told us 4 million iPhones have been sold not very long ago, and I've said iPhone's sales momentum is great and the market share is huge in a short time. BUT ... this is like saying Mac / OSX is growing rapidly and upping its market share quite nicely. Yes it is, but in terms of total installed base, it's *tiny* compared to Windows. The iPhone still needs to be around for a while before its total number of users matches WM or RIM or Symbian - one quarter of great market share doesn't wipe out a big existing lead from other companies.

3) The phones you've listed and the businesss models for which they distribute their software isn't iTunes. They're not as easy to use as iTunes, and the distribution package isn't something most people already have on their desktops to tether their iPods to.
Fair enough that iTunes is a huge and popular distribution medium, and true that nothing the others have can match it - but don't see that that necessarily means lower prices - if it did, howcome Amazon is already beating iTunes for music pricing?

4) Brand name Convergence and product cohesion. Of all the phones you've listed, none of them have any of this going for them, except for the reputation RIM has with it's Blackberry. Even in that case, I can't hook my Blackberry up to my desktop and move my iPod movies over to it and vice versa. Being able to do more with your hardware when its matched with products from the same family is a huge deal maker for many users. The notion that I can do more with my applications provided they're on the parent platform, in most cases, is a huge plus, especially if that means I'll be sharing data with other devices under the same umbrella. This might not be the norm on PC, but it sure is on the Mac, and thats another plus for the iPhone in that sense.
This is all good, but if anything what you've just said makes apps for the iPhone *more* valuable, so maybe justifying higher prices.

---

Based off volume alone, theres no reason Apps should ever go above $9.99, we're not buying a full suite here, we're buying mobile applications to access information we'd otherwise have to use a desktop for, we're not going to be designing Ads in a mobile photoshop, or debugging code and compiling web apis on it either. This is a scaled down medium who's price points should be in line to match this.
*Should be* - maybe so, though I don't agree - but the question is whether they *will be* and I just really don't reckon you're going to see a marketplace for iPhone apps that tops out at $10. There are already 3rd party apps out there on Installer, as you know, that are proposing to charge near $30 - and they won't be the only ones ....
 

x666x

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#10
Ever heard of Amp'd Mobile? Just one of the many carriers gone the way of the Dodo. They had a unique distribution method, but it didn't work.

Have you looked at the Nintendo Wii's businesss model? It uses low price points to move its wares, and if you're not familiar with the product, lets just say its very hard to find on shelves even 2 years after its debut. Nintendo was a distant #3 in the game industry, yet they are now #1. Quite a change in the span of only 365 days given they've been in 3rd for well over a decade. Gamecubes were no longer selling, nor were their attach rates worth mentioning, if it wasn't for the DS/GBA Ninety would have probably gone belly up by then. Yet, by presenting consumers with a businesss model which was more appealing by way of price, they consumed more than 80% of the market at a time when their consoles only represented less than 14%. That was a *TINY* (as you put it) installed base with brand recognition, but as history has shown us, anything is possible given the right marketing and price points.

Lastly, those people charging 30 dollars for their applications are pretty unscrupulous at best. Programming for a rogue platform and then expecting to get paid for it. Not on my dime, and not at those prices. Why charge so much? Because you have to get what you can, when you can. They have no iTunes to peddle their wares for them 24-7, 365 days a year.

Consider this, how do you bring the price down in manufacturing? You produce in bulk. How would you bring down the price in software? You distribute in bulk via iTunes.
 
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KNK

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#11
Lastly, those people charging 30 dollars for their applications are pretty unscrupulous at best. Programming for a rogue platform and then expecting to get paid for it. Not on my dime, and not at those prices. Why charge so much? Because you have to get what you can, when you can. They have no iTunes to peddle their wares for them 24-7, 365 days a year.

Consider this, how do you bring the price down in manufacturing? You produce in bulk. How would you bring down the price in software? You distribute in bulk via iTunes.
I think you guys are right. And the $28 for Voicedial is high, too high. So do you think when that trial is over to just hold off and not pay. I know Patrick has it because he pointed it to me. So this is a classic example what you are saying x6. What do I do then?:eek:
 

patrickj

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#12
Ever heard of Amp'd Mobile? Just one of the many carriers gone the way of the Dodo. They had a unique distribution method, but it didn't work.

Have you looked at the Nintendo Wii's businesss model? It uses low price points to move its wares, and if you're not familiar with the product, lets just say its very hard to find on shelves even 2 years after its debut. Nintendo was a distant #3 in the game industry, yet they are now #1. Quite a change in the span of only 365 days given they've been in 3rd for well over a decade. Gamecubes were no longer selling, nor were their attach rates worth mentioning, if it wasn't for the DS/GBA Ninety would have probably gone belly up by then. Yet, by presenting consumers with a businesss model which was more appealing by way of price, they consumed more than 80% of the market at a time when their consoles only represented less than 14%. That was a *TINY* (as you put it) installed base with brand recognition, but as history has shown us, anything is possible given the right marketing and price points.

Lastly, those people charging 30 dollars for their applications are pretty unscrupulous at best. Programming for a rogue platform and then expecting to get paid for it. Not on my dime, and not at those prices. Why charge so much? Because you have to get what you can, when you can. They have no iTunes to peddle their wares for them 24-7, 365 days a year.

Consider this, how do you bring the price down in manufacturing? You produce in bulk. How would you bring down the price in software? You distribute in bulk via iTunes.
Amp'd Mobile and carriers and dodos = Left Field - no idea how that relates to any of this.

Look at Wii's businesss model = what am I a frickin financial analyst? I'm just saying if you think iPhone apps are going to top out at $10, I think you're well wrong.

And as for your businesss model, with all the 'Distribute in bulk' stuff = cool theory. Here's the deal though. You have no bulk. You have a phone tied to single carriers in *four* countries across the entire world. So take that bulk versus, say, Symbian or WM, that sell in virtually every nation across the globe, are not tied to single carriers, and have a *massive* head start on you in terms of existing users.

How exactly does the bulk equation work there?
 
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Lincoln

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#13
There are people here you say that they will pay for applications from Installer because they respect what the developers do. I respect it; but I don't know when I'll be tempted to update or Restore and stop using that application.

But with SDk apps, I have no problem with paying. I figure that there will be some smaller, less useful apps that will go for free, and some bigger, more useful ones that will cost a bit.

That maximum I would pay is $25, for a solid app that i would use every day. I know that I'm going to enjoy the applications offered from it, and if it means paying for them, so be it.

- John
 

kylegod

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#14
I was just thinking to myself how disappointed I would be if some really nice third party apps came out and ended up costing too much money to download. I wouldn't be too concerned about anything under $15-$20. Anyone else here have any thoughts?
15-20 is pushing it. I think they'll be around 5 - 10 bucks. Probably about the same cost as games cost on other phones. I bought poker for my Samsung which i had it, i think it was 5.99 or 6.99? Hopefully itll be around there.
 

kokogirl

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#16
I do not think I would pay more than $10 for a game, but if it is a productivity app I would pay $25-$30. I think I paid $25ish for an app on my BB that let me customize my email accounts, including signatures, etc. It worked well, I used it daily, and so I did not mind paying. I could see paying for voice dialing, also, although I would hope Apple would add that in as a firmware upgrade sometime.

I am waiting for a more integrated TO-DO list with the calendar functions (reminders, urgency) like my BB had. I would definitely pay $30 or that.
 

Tinman

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#18
Amp'd Mobile and carriers and dodos = Left Field - no idea how that relates to any of this.

Look at Wii's businesss model = what am I a frickin financial analyst? I'm just saying if you think iPhone apps are going to top out at $10, I think you're well wrong.

And as for your businesss model, with all the 'Distribute in bulk' stuff = cool theory. Here's the deal though. You have no bulk. You have a phone tied to single carriers in *four* countries across the entire world. So take that bulk versus, say, Symbian or WM, that sell in virtually every nation across the globe, are not tied to single carriers, and have a *massive* head start on you in terms of existing users.

How exactly does the bulk equation work there?
While I think we will see prices in the same range as Winmob, Palm, and Blackberry apps it needs to be pointed out that the iPhone is in a different class: it has its brother the iPod Touch that will undoubtedly run most of the same apps as the iPhone.

But robust iphone-only apps (PIM management, etc.)? I see them priced at what the market will bear. If that means $25 then that will be the price. There won't likely be bulk sales of these kinds of apps.

I see $5-$10 being only for simple games, and simple apps.


--
Mike
 

patrickj

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#19
While I think we will see prices in the same range as Winmob, Palm, and Blackberry apps it needs to be pointed out that the iPhone is in a different class: it has its brother the iPod Touch that will undoubtedly run most of the same apps as the iPhone.

But robust iphone-only apps (PIM management, etc.)? I see them priced at what the market will bear. If that means $25 then that will be the price. There won't likely be bulk sales of these kinds of apps.

I see $5-$10 being only for simple games, and simple apps.


--
Mike
The iPhone is definitely a class apart, in so many ways. To me, if anything that says apps developed for it are more valuable. And yeah, I definitely expect prices in the same range as other established mobile platforms.

I just think it is way optimistic to see lots of folks thinking all iPhone apps will go from $5-10, with many seeming to imply 'Apple will make it so'. Apple just got done setting a $20 price tag on a set of apps for the Touch owned by early adopters! These aren't even shiny, new 3rd party apps - and the email client is something that comes standard on nearly all PDAs. If they're happy to stiff early Touch owners for apps that arguably should be included basics (as they are now), what makes anyone so convinced they're going to be manipulating any software prices in a downward direction?

Also, although Apple has a deservedly outstanding rep for innovative and excellent design, and for making superb products, they're not known at all for being the champions of low prices or greatest value. Just don't see where folks get this sort of 'Apple will make 'em nice and cheap for us' view ...
 

Griffinaz

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#20
While I think we will see prices in the same range as Winmob, Palm, and Blackberry apps it needs to be pointed out that the iPhone is in a different class: it has its brother the iPod Touch that will undoubtedly run most of the same apps as the iPhone.

But robust iphone-only apps (PIM management, etc.)? I see them priced at what the market will bear. If that means $25 then that will be the price. There won't likely be bulk sales of these kinds of apps.

I see $5-$10 being only for simple games, and simple apps.


--
Mike
I think you are correct Mike. This is what is happening right now with standard PDA software (not necessarily phone based). If you go to Handango and look at the pricing it is mainly based on demand and volume. Those specialty programs such as aftermarket PIM replacements are in the upper $20-30 range where games and novelty software range in the $4.99-$10 range. It is not because the PIM software took more time and effort to create, it is simply not a program type that most users will upgrade. Most non-businesss or non-executives have no need for an improvement to a calendar that has basic functions and would not be willing to pay for that software. Therefore the costs are higher.
I believe that the software provided through iTunes will follow this same pattern. I think you will see common use software with high demand in a very reasonable cost range with specialty software such as foreign langauge dictionaries, PIM replacements, that type of thing ranging higher than everyones hopes of $5-10.