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iPad App Pricing

, by Patrick. Filed under App Store, Opinion. 4 Comments

In the wake of the introduction of the iPad, I’ve been thinking about iPad software pricing. Apple is strongly encouraging developers to make a single binary that runs on both the iPad and the iPhone, so called “universal” applications. What that means is that while the user experience is enhanced because a user won’t need to buy both versions of an application, it means pricing is going be very tricky.

During the iPad keynote, Apple showed off some very nice looking versions of the iWork products. Apple has set the price point of these applications at $9.99. That’s a price point a lot of iPhone apps tried to start at during the opening of the App Store. Most notably Twitterrific Premium from The Iconfactory, Dark Slide Premium from Connected Flow and Trip Cubby from App Cubby, all of which now sell for much less than that. With this “race to the bottom” on the App Store, customers cry foul over incredible applications that are priced “too high” at $3.

Apple has also said that existing iPhone applications will run on the iPad and that they will be able to be “blown up” in size to be full screen. From reports I’ve heard and my own experience in the simulator, this doesn’t look very good. Developers will want to have an iPad specific interface built into their app. The amount of work to get an iPad app’s UI to have the great polish it should have is going to exceed that of the iPhone. This will mean higher development costs. Presumably with higher development costs, higher prices will come with it. The rub is that these universal applications are going to be subjected to the same price pressures from the iPhone side of the market because users will buying a single binary.

Being the optimist that I am, I see this as a potential turning point in iPhone app prices to try and raise them from the floor. I also hope this means a lot less “toy” applications being built for the iPad. At that point, the realist in me steps in and realizes it’s still a gold rush from the developers side, so be prepared for “Fart for iPad extreme edition”. As well, be prepared that the app store buying public are still going to be upset at any price.

One suggestion I’ve heard is to sell the universal app at an iPhone market price point and have in-app purchases to unlock iPad specific functionality. This is a reasonable idea, but I still think a developer would want an iPad specific UI even on first launch on the iPad, so the extra costs problem remains. You also risk backlash from the market of iPad only users.

Maybe the long term answer is to buck Apple’s suggestion and create an iPhone version and an iPad version, both with separate price points. While that will be an increased cost for an owner of both platforms, it will hopefully foster more sustainable development for the iPad. The current iPhone market is certainly not sustainable from the development point of view unless you’re in the small percentage in the top 100 lists or on the front page of the App Store.

4 Responses

  1. Another option you’ve missed off is to have two versions: 1 for iPhone, 1 Universal. You can then market the Universal one as “buy the iPad version, get the iPhone version free”

  2. I like Martin’s idea. It’d be even better if developers standardized around the same nomenclature for the Universal apps. I guess they could just append something like Cinderapp Universal or whatever. So that iPad user automatically knew that the Universal apps covered both devices and wouldn’t complain (hopefully) over a small premium.

    I think iPad users are going to be different than iPhone/iPod Touch users. The iPad is going launch at a much higher price for much more functionality and iPad users will shift their expectations up accordingly which means many will accept higher pricing IMO.

  3. Martin’s suggestion is a great idea! “buy the iPad version, get the iPhone version free”, for universal apps. This situation is similar to what certain apps that have a Mac OS X version plus an iPhone version – there is no way to tie purchase of the desktop version and get the iPhone version free. With universal apps, this will be possible (your “desktop” is the iPad now).

    Come to think of it, it can be truly “universal”. Have the iPhone, iPad, and OS X versions all in one bundle. With the shared documents feature of the iPad, the iPad can share the .app of the OS X version for the user to download (serial distribution will be another matter entirely that needs to be solved in this scenario).

  4. There’s another option you missed too: separate iPhone and iPod app stores (and you can start fresh with the iPad app store, using a different model and different presentation). This comes with its own issues, but solves more problems than it creates IMO.

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