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A $5 app isn’t expensive: Customers need to help fix the App Store economy

Lex Friedman | April 8, 2013
Given that iPhones are anything but cheap, why are so many of us surprisingly cheap when browsing the virtual shelves of the App Store? Ironically enough, that tendency to be cheap may end up proving costly in the long run.

Our smartphones are probably one of the most expensive things we carry around each day. But given that iPhones are anything but cheap, why are so many of us surprisingly cheap when browsing the virtual shelves of the App Store? Ironically enough, that tendency to be cheap may end up proving costly in the long run.

It's no shocker that free apps are vastly more popular than paid apps; everyone likes getting something for nothing. But it is surprising that folks consider a $3 app expensive, and a $10 app downright exorbitant. I know people who play the same iOS game every single day, but choose to stick with the free version - despite its constant, intrusive ads - rather than pony up $5 just once to go ad-free forever.

Of the top 20 best-selling iPhone apps, 15 of them cost $1; the priciest one costs $7. The average price of the top 100 paid apps in the App Store is less than $2.

I'm neither an economist nor a psychologist, but it strikes me that too many iOS device owners fail to act in their own best interests - both in the immediate near term and in the long term - when they scoff at the thought of spending money in the App Store. Here's how customers who spend lavishly on iOS hardware punish themselves by skimping on apps.

You get what you pay for


OmniFocus for iPad costs $41.99, far above the typical price range in the App Store. But it has a 4-star rating and many positive reviews in the store.

In general, I'd argue that apps that cost money are often superior to free alternatives (though there are, of course, numerous exceptions). Few Twitter devotees would argue that the company's free app offers the best experience, but many stick with its app because it's free, instead of paying for the far better experiences offered by for-pay apps like Tweetbot and Twitterrific.

Some might counter: "Hey, the freeTwitter app lets me post tweets and read tweets! Why would I spend $3 on Twitterrific?" In that app's case, it's for the lovely design work, along with the app's features that Twitter itself would never offer: muffling, to temporarily silence noisy friends who are live-tweeting sporting events you don't care about, or its unified timeline, which combines tweets, mentions and direct messages all in a single view. Simply put, you're missing out on better features and better apps when you stick with free alternatives.

Many free apps are fine. But when you pay for a premium app, you are often paying for a deeper, more well-considered experience - one in which you are truly the customer and not the advertisers supporting the "free" app behind the scenes.

 

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