What’s better than a 99-cent app? Well, a free app of course… but the 99-cent app is a new business model taking place in the insanely successful App Store for the iPhone and iPod touch — and it’s the next best thing since, yeah, free stuff.
Other things you can get for 99 cents: There’s not much worthwhile things that you can get nowadays for 99 cents or less — even the 99-cent stores are starting to boost their prices. But the next time you visit the iTunes Store, take notice: roughly 3 minutes of music cost 99 cents. But these apps that are popping up on the same store, some ingenious and some not, provide more amusement time than that. Of course, unless you’re into listening to the same song 100 consecutive times.
But why a 99-cent app? Free does not pay the bills. 99 cents… not so much… But with the high reach the App Store currently has (and expanding!), it is viable to eventually turn a profit without making your loyal customers think twice about buying your product. And yes, 99 cents is the lowest price Apple will allow developers to stick to their apps.
What can be done with it? Now let’s observe the Koi Pond example — do you think a virtual pond simulator app would’ve been as successful if it had been a bit more expensive? The only way it could’ve been even more successful is if it had been free. And as simple economy demonstrates, the higher the price, the less it will sell. Remember the I Am Rich app? It cost nearly $1000, and only managed to sell a handful. But to be honest, I can’t believe it even sold one copy since the thing offered almost no functionality.
What the future holds. If you didn’t believe it, expect more 99-cent apps to appear. The 99-cent idea is a new way to move abstract goods in an abstract marketplace, where quantity, supply and demand, and other simple aspects of material economics don’t seem to apply because the goods will never sell out. Now if you’ll excuse me, I’m going to take my change jar to those machines they have in the supermarket to get more money to spend in apps.
Galley on September 22nd, 2008 at 9:05 am says:
If I developed a simple app, I would probably price it at 99 cents rather than free. When all is said and done, you might make a few thousand dollars.