iPhone App Pricing Limits Developers

HardYakka writes "According to this post in the Fortune blog, the iTunes app store has been a boon for users but some developers are saying the number of free and 99 cent apps make it difficult for developers to create complex, higher priced apps. Craig Hockenberry of Iconfactory says the iPhone may never get its killer app like the spreadsheet was for the Mac. If Apple does not do something, the store will be left with only ring tones and simple games. Some are suggesting that overpaid developers are the problem and the recession will soon lower the wages and costs for complex apps."

Comments

Spreadsheet

[penguinboy]

Visicalc was an app for the Apple II, not the Mac.

Re:Spreadsheet

[morgan_greywolf]

Yeah, I have no idea why people think the 'killer app' for the Mac was the spreadsheet. The Mac's killer app was desktop publishing and, later, graphic design. To this day, there is still no better platform for DTP and graphic design than the Mac.

Re:Spreadsheet

[truthsearch]

Isn't this advantage almost exclusively for those entirely new to each respective OS?

No. My company switched from all linux desktops to all Mac desktops and laptops about 3 years ago. We're all software developers and very experienced on linux desktops. Our productivity is way up because we spend so little time fussing with the Macs compared to how much time we spent maintaining the linux desktops.

I'm not saying the case will be identical in every situation. But sometimes linux just takes more time to maintain.

Re:Spreadsheet

[stewbacca]

Pagemaker (or Quark), Freehand (Aldus), Authorware/Director, and Photoshop v1.0 were the killer apps back in the late 80s and early 90s. Those programs are what made the Mac "insanely great" and the IBM compatibles go "beep" in all their mono-color glory.

Re:Spreadsheet

[ishobo]

How about I ask my wife? She works as an artist. Honey, is computer animation a form of graphic design. She says no. You would get no animation training in a BFA or MFA graphics design program. The field is about typography, print and editorial design, branding, information design, and packaging.

Re:Spreadsheet

[morgan_greywolf]

As others pointed out to you, what Pixar and other movie studios do with Linux is CGI, not graphic design or DTP. Those are completely different and unrelated concepts.

Additionally, I'd like to point out that while you can certainly do professional graphic design on Linux these days (I do, personally. Surprise! I don't even own a Mac!), there isn't much depth in terms of software choice, and the software that does work is still immature.

You have two good illustration programs -- Inkscape and Xara. Inkscape isn't too bad and it's gotten lots better, but is still missing key features like automatic drop shadows. Xara is okayish, but uses a non-standard file format, is limited in some ways and is pretty unstable.

You have one good photo editing application -- the GIMP. And it lacks a lot of Photoshops really slick 3rd party plugins and the ability to modify photos in CMYK mode. -- But note that it does do CMYK seps, which is really all you need.

There's only one good DTP layout package, and that's Scribus. Scribus is still lacking in some areas compared to major closed-source apps like QuarkXPress and PageMaker -- mostly in the prepress area. It's also less stable than I would like. It does output to PDF, which is good enough for many service bureaus, however.

Now let's compare with the Mac: You have industry standards like Adobe Illustrator and Macromedia Freehand on the illustration front. Plus, you can run Inkscape on OS X. You have Photoshop, you have QuarkXpress, you have PageMaker. And you have Scribus and GIMP.

And that just touches the surface. There are so many more applications on the Mac. Plus, Macintosh fonts tend to be rather better than their Windows/Linux equivalents -- the font designers pay much more attention to kerning details and such on the Mac than they do on Windows for some reason.

After having said all that....I don't own a Mac, though I have used one in the course of my professional graphic design work. I use Linux because I prefer the concepts free and open source software over closed-source, proprietary stuff ripe with vendor lock-in, etc.

Re:Spreadsheet

[FishWithAHammer]

For crunching, yes, Linux tends to be used (in part because it makes the boxes doing the crunching cheaper). But the individual artists' workstations are extremely rarely Linux-based, sorry.

I mean--are you seriously going to try to say that Linux beats either platform capable of running Adobe's software when it comes to actually doing the graphics design part of the job? (And if you say GIMP, I'm just going to laugh at you. It's nice if you haven't got anything better, and that's about it. Cinelerra is okay for what it does, but unfortunately for your argument it runs on OS X, too. I'm not enough of a video editing guy to say whether I prefer it over Premiere/After Effects, though. And I will call the men in white coats to take you to be fitted for a very long-sleeved jacket if you try to compare Inkscape with Illustrator.)

Re:Spreadsheet

[Dahamma]

You are just digging yourself deeper with every ignorant post you make.

Who the hell cares what a demo artist or your friend uses. The "bigtime" (your word) studios have clear separations of software and personnel for modelling, animation, and rendering (etc). Some of these steps, especially rendering of late, is done on Linux-based server farms, but a LOT of work is still done on Macs with both commercial and proprietary software.

To your Pixar example... DUUH! Steve Jobs is Chairman of both Apple and Pixar, and trust me, he makes sure Macs do and always will have a significant presence there.

Re:Spreadsheet

[binarylarry]

No, Macs are designed by programmers like every other OS.

The difference is: Mac OSX programmers have a very angry man in a black turtle neck furiously yelling at them as they develop new features. This "turtle necked fire," so to speak, is what drives the high quality components of the modern Mac operating environment.

It's a bit like a Katana forged by a master craftsman.

Re:Spreadsheet

[mabhatter654]

and the first rounds were cheap... prices for good software rise as the market proves GOOD software is hard to make.

Right now iPhone is in "gold rush" mode. Every body is making everything thing at every price because nobody knows what the market is yet, it's been 6 months.. hardly time for doom and gloom.

I think it's time to START complex apps as small apps and see how the market reacts. What can you sell for $1.99? The market is not ready to commit $29.99 to ANY app yet.. frankly if somebody else can make the same app for $2.99 then your app is not worth the higher price.

There's three kinds of "complex". There's problems that are purely hard to solve like encoding video or building 3D game engines that take real talent to make it look easy. There are projects that are large and take lots of grunt work... ERP systems come to mind as simple programs but you need lots of them to work well or they take lots of content or research... think encyclopedias or the Sims again, it takes resources or creativity to make the volume of content required in a manner to sell it, not easy for good quality without money. The last are simply programs that are big... like office programs... They are easy to duplicate functions, but control the market because they have lots of little pieces and people using them. Unless you are in the first two groups don't expect to charge a lot.

Re:Spreadsheet

[profplump]

There are lots of things linux is great for, and depending on your usage it might even be a decent desktop OS. But that's certainly not the case for every desktop user, even with releases from the "last X years" (though I agree they are getting better).

I've run and used daily both an OS X and an Ubuntu workstation for several years, and in that time I've essentially given up on trying to make A/V playback, browser plugins, or even multiple-screen use work on the linux box. 95% of the stuff works fine -- I can play back most codecs, use most browser plugins, and display video on both screens. But that last 5% takes hours to fix, if it can be fixed at all. There are still some codecs I just can't make work, some plugins that won't run, and my cursor is either displayed incorrectly or slightly mis-aligned on my second and third monitors, even after hours of tweaking.

I'm not saying my Mac never annoys me, but when it does the answer is almost always cut and dry -- "it can't be done". Compare that to the linux machine, where "it works for me", or "you just have to do to get it going, unless you have GPU X, then you need to do ". Now sometimes those extra 28 steps are worthwhile, because I can do things that aren't possible on my Mac. But sometimes those extra 28 steps just eat 30 minutes of my life, and if I was using my Mac I wouldn't have wasted the time.

If I were just doing basic computing tasks, and didn't care to muck with the configuration, a linux desktop would be perfectly acceptable and would require little maintenance. But as someone who wants to play with things, and who isn't willing to accept that it works for others but not for me, a linux desktop can be a huge distraction and time sink.

/ Would give my grandmother linux on the desktop

// Still has a linux desktop in daily use

/// Just also needs a unix-like computer that works well enough to keep me from getting distracted by administrative tasks

Re:Spreadsheet

[andrewbutts]

I am sitting at my desk at Pixar right now. Our graphic designers use macs.

Add Top Apps for more price ranges

[justcauseisjustthat]

Simply add Top Apps categories for more price ranges...
$1-$5
$5-$10
$10-$50
$50- ??

Re:Add Top Apps for more price ranges

[Anthony_Cargile]

I'm more worried about the usage of the oxymoron "overpaid developer".

Re:Add Top Apps for more price ranges

[frosty_tsm]

Agreed. Especially when you consider the low product quality that results and higher developer-count required to deliver with lower-cost developers.

Re:Add Top Apps for more price ranges

[Anthony_Cargile]

And if thats not bad enough, Apple may at any time remove an app designed by us "overpaid developers" just because it may conflict with an existing (or to be existing) Apple app, or if it just pisses Apple off (IAmRich).

I've joked ever since I found out about this that Opera, the Mozilla Foundation and Sun should release their software for the jailbroken iPhones only, in addition to an Android port.

Mobile platforms are the new platform wars: Android (representing Linux), iPhone (Mac), and Windows Mobile (Win). The next generation developers will have to port apps painfully across these platforms, or pick and choose at the cost of some customers. Not to mention other platforms like Blackberry and the like that don't fall into those categories, save Sun's JavaME portability.

If I were ever asked to write a mobile client for any application of mine by anybody, public or not, I would probably shoot myself at the first thought of "But I have this phone". You can have it, spare me until the dust settles.
</rant>

Re:Add Top Apps for more price ranges

[Anthony_Cargile]

No I wasn't talking about the same developers you are, e.g. coders that throw function pointers in directly with raw input and similar shit and wonder where the bugs/exploits come from (and get paid a wad to write those patches).

I'm talking about the high quality, underrepresented programmers that get stuck in a low-end job that not only underminds their ability, but pays much lower than the quality of code is that they write, which would be much more suitable for the big companies the shitty programmers get put in. When they would hear "overpaid developers", the first thing they would think of is "Yeah, all I need is less pay".

Re:Add Top Apps for more price ranges

[tapehands]

oy. Seriously...if I were a developer that was considering writing an app that could be construed as "killer", the #1 turnoff would be Apple's ability to cannibalize my work.

What recourse, if any, would there be if Apple decided to yank my $XX app off the store, only to have the same functionality trumpeted in a new firmware release? (like they already have done)

Futhermore, Apple chooses when and where to enforce their store rules. Google is allowed to break rules. Would a small development firm be so lucky?

There just isn't enough incentive or security to develop something much more useful than a game, ringtone, or eggtimer.

What a whiner.

[Whiney Mac Fanboy]

Iâ(TM)ve been thinking about whatâ(TM)s causing this rush to the 99Â price point. From what I can tell, itâ(TM)s because people are buying our products sight unseen. I see customers complaining about how âoeexpensiveâ a $4.99 app is and that it should cost less. (Do they do the same thing when they walk into Starbucks?) The only justification I can find for these attitudes is that you only have a screenshot to evaluate the quality of a product. A buck is easy to waste on an app that looks great in iTunes but works poorly once you install it.

Why not release a free, crippled version of your app that allows people to look at it, evaluate it & decide if it's worth $2.99? Now where have I heard of that business model before?

Honestly, there's so many development restrictions on iPhone apps, why bother publicizing this non-story.

Re:What a whiner.

[Fluffeh]

This is what most of the developers are doing. I have bought a ton of full priced games (that are $5-15) as well as a few apps after trying the free versions.

I think the article could be slightly amended to read: "Poor quality high priced apps won't sell for iPhone" or even "high priced apps without a demo version won't sell on the iPhone" and it would be much closer to the mark.

Like spreadsheets for the MAC?

[way2trivial]

What the Hell? spreedsheets were the killer app for PC's period.

it was not mac-specific-- it was a much earlier dawn of the PC age.

"VisiCalc was the first spreadsheet program available for personal computers. It may well be the application that turned the microcomputer from a hobby for computer enthusiasts into a serious business tool.[1] VisiCalc sold over 700,000 copies in six years.[2]"

Re:Like spreadsheets for the MAC?

[_Sprocket_]

VisiCalc was first released for the Apple (not Mac), and sales skyrocketed. Apple's were the original business desktop computer.

And not only that, they were a key part of getting IBM to consider the microcomputer more than a toy. Enter the IBM PC.

Re:Like spreadsheets for the MAC?

[jackbird]

Not if you adjust for the number of PCs in the wild at the time.

Right

[Junior J. Junior III]

Some are suggesting that overpaid developers are the problem and the recession will soon lower the wages and costs for complex apps."

Because in the Shitty New Economy, people will be blowing all kinds of money on applications for their overpriced smartphones.

Re:Right

[iluvcapra]

Last time I checked, the iPhone will typically run you $2000-$3000.

By that logic, a Blackberry will run you $2000-3000; a Motorola POS with no money down will push $1500.

BS

[Architect_sasyr]

This is utter crap on behalf of any developer. If you make a decent software app and it sells to 100,000 people for $0.99 then how much have you actually made. Yes it is a competitive market, but you sell your app for 0.50c and let people go with it. 100,000 people buying an app for 50c each should more than pay for it. An idea could be as complex as you like and I still can't see spending more than $100 Grand on it for an iPhone app.

Unless you're a shitty developer or you're not writing a good app.

Re:BS

[ScrewMaster]

and I still can't see spending more than $100 Grand on it for an iPhone app.

100k goes fast, and that's not even considering non-development-related costs. If your app requires hosting or has any server-side component, that's going to be an ongoing expense. If you aren't selling your product as a service, or have a subscription fee, those costs are going to have to be paid out of the take from new sales. If your app proves to be really popular, odds are you're going to need a support staff. That hundred grand is gone. Pfft.

This is particularly true because any Apple-related product is going to be heavy on the graphics, and that's going to require art support (not many coders know their way around Photoshop or have any animation skills whatsoever.) Ditto on sound effects and music. A hundred grand sounds like a lot, but when it comes to software development and support nowadays, it really isn't.

Well, that is the problem right there

[rolfwind]

One developer said:
"Both developers and designers cost somewhere between $150-200 per hour."

That's too much. I haven't used iTunes, but if it isn't based on simple popularity but has some kind of after-the-purchase rating system, there shouldn't be too many worries. If there isn't, they should implement one. With reviews and ratings like Amazon.

I also have a hard time believing that only the most simple apps will get made, there seems to be a "10 Most Useful" iPhone App list every other week popping up at some social sites like Digg.

Re:Well, that is the problem right there

[Lumpy]

Exactly. It's a bunch of really whiney people complaining they are not making Millions overnight on the iphone.

Guess what. Cellphones APPS DO NOT SELL IF THEY ARE EXPENSIVE.

This is a fact that has been around ever cince the cellphone could run apps. Now we have a bunch of whiney babies complaining about the prices they can sell their crap apps at.

What's next? They going to ask Washington for a bailout as well?

IF Haji can write a app and sell it for $1.99 that you want to write and sell for $29.99, Haji is going to kick your ass in sales. Whining like little crybabies will not change that fact.

Re:Well, that is the problem right there

[p0tat03]

Well, contract developers *do* cost that much. I think the real headliner here is: "Useless People Who Must Contract Everything Out Find There's No Profit"... which is kind of a no-brainer. The people who can do their own design, code, and whatnot can operate in the iPhone space. If you're a PHB type who can't code, can't design, and just can't do anything except cook up wacky iPhone application ideas, then there's no room for you. Seems like there's nothing wrong here :)

competition?

[arbiter1]

Another limiting factor on iphone app's is fact apple will kill off any app that competes with their's or anything they are about to put out.

It's a stupid rant

[tkrotchko]

It's a stupid rant. Look at the market for PC software.

There are a lot of *free* applications. Lots. More than I can every use.

Then there are inexpensive shareware stuff. $5-15

Then there are the mainstream shareware apps. $40-60

From there, applications go as high as you want to pay.... $100-500 $1000, $5000

All are available on the internet. Do free applications limit the abilities of developers to churn out $50 software? Or $100 software? No. People will pay what the software is worth.

This guy seems to be making the argument that somehow a low price sets the expectation of low prices. It's a dumb argument. If developers come up with an application that's worth $500 guess what... they will pay $500.

What he's really saying that the $1 applications are so good that he can't compete. And that's probably true. What he needs to do is make his applications worth more than $1. It's not the platform that's holding him back. It's not the price of cheap software holding him back, it's his own inability to write valuable software that commands a premium price. Seriously. Does he even understand that you can't write a general purpose iPhone app and expect to get $50 for it? He's going to have to hit some vertical market software (highly specialized) to command premium dollars. How about a full-blown VST/Softsynth app that will accept plugins for the iPhone? I'd pay $200 for that. How about working with a high-end electronics company to write apps to control lighting/music for home-automation? He could probably get $300-500 for that.

Just being a good programmer isn't good enough. He should know better.

Seriously, he's all wet.

Re:It's a stupid rant

[c_forq]

To add to your point, I work at a company that uses a wide mix of programs (FOSS and closed source). Our company also staffs over 30 programmers (we are not a software or computer-related company, the programmers just do in-house stuff). There are still programs we pay for that are $3,000+ a seat [plus the worker that runs it, who gets $60,000/yr plus benefits, in the midwest (where the cost of living is WAY lower than the coasts or large cities)]. Something that gets the job done, and done well is worth that.

Half truth

[cpct0]

I'm an iPhone developer. My company have been in the top sellers in US and Canada. And I agree, with some reserve, to what is being written.

If you look at the games that are produced on the iPhone, they are very good, frankly, many of them have many hours of replay value, many of the apps are top notch, and compared to other phones, they are of insane quality. And for a game that we sell more than $20 on any PC, and even more on consoles, we can only barely nudge a $5 on the iPhone, for nearly the same production quality. That's thousands and thousands of man-hour of work, sold at $5. Think about that. Even then, we got average results: either the comments were raving on our game, either people were giving one star and saying it was way too expensive. That's total bull. And that's what's pissing off people creating solid applications.

When the iPhone started, some games (like Monkey Ball) were $10. Some productivity apps were $10 to $15. I paid for a few $10 software, and they were with ample merit. Omnifocus is such a tool, real great, well made, even the v1 was excellent. Then, the top sellers became $5 software. Now it's mostly $1 software.

And that's where I put my grumpy developer shell on the shelf. Frankly, I congratulate $1 games and free games and $1 leisure and productivity tools. They make sure we are not paying $5 like on other phones to get a total piece of crap snorted out by a subcontract firm in 2 weeks. They make sure if we want to pay $5, it's for a good reason. That a software becomes a meme and gets sold by the thousands for 2 weeks and then get replaced by the following meme, I congratulate them. The only reason we are noticing these is because the way the ITMS works "free" and "pay" tops, and nothing else.

Many good applications cost much more, and hopefully they are getting their own crowd and their own push, with their own publicity. Like on PC with freewares and sharewares and commercial software, you pay mostly by merit.

Re:Cry me a river...

[Red Flayer]

The iPhone is the first and foremost platform for cellphones these days.

[citation needed]. Truth is, Symbian still dominates the mobile platform market, with RiM in second (though Apple is closing in on Rim).

Apple's market share is about 1/4 that of Symbian.

Please, don't talk out your ass about market share without doing your homework.

iElephant in the Room?

[fuzzyfuzzyfungus]

Sure, having to compete with el-cheapo apps isn't anybody's idea of fun; but I find it very odd that their presence would act against complex apps. If the simple stuff is a mass of cheap and/or free, then the profit motive will lead developers to try to build products that distinguish themselves from the mass and can command a higher price(or, y'know, lobby for new laws, RIAA style).

Rather than "OMG cheap competition!" I'd be inclined to suspect a couple of things: First and foremost: Uncertainty over App store approval rules. Apple can, and sometimes does, just yank the rug out from under an app during the approval process. The rules are underdetermined and don't seem to be followed terribly consistently, and there is no real appeal. This is Apple's right, legally speaking; but is it any huge surprise that people are not rushing to make large investments in highly complex products?
Secondly, cellphones, even nice ones, are mediocre platforms for big highly complex stuff. Apple has done a substantially better job than usual; but nothing(presently available) can really disguise the fact that you are working on a tiny screen, with very limited input options.

Somehow, those terrible, terrible, innovation killing people who give software away have failed to destroy large, complex applications on the PC, I strongly doubt that they are managing that here.

Bravely Stupid?

[Gary W. Longsine]

Your hired. You'll be paid $100k a year, and you'll write a new iPhone app for me every six weeks. An idea could be as complex as I like, and I still can't see it taking you more than six weeks to implement, unless you're a shitty developer or wasting time, in which case, you're fired.

Sarcasm is dead.

[Gary W. Longsine]

Uhm... "Flamebait" this was not. Using the exact same argument as its parent, applied on the flip side of the developer relationship (cost, rather than revenue) should have merited an Insightful mod. Alas, there is no "understands subtle arguments" requirement for moderators.

It's UNIX! I Know This!

[SuperKendall]

Jeez, when will people accept that Macs are designed by people who themselves are designers and the OS is built around the typical workflow of designers and not that of code geeks and techies?

If you knew anything of the internals you'd know just how wrong you actually were. Who among the code geeks and "techies" would not appreciate a mainstream computer that comes with Bash, Apache, Perl, PHP and Ruby built right in? Or can appreciate upcoming things like OpenCL?

It's true there are ALSO a lot of great design oriented features added atop the very nice technical layer - but the technical innards are very much aimed squarely at the people you think have no interest.

Trial versions

[sc00ch]

For me its inability for developers to offer trial versions of apps using the App store. I'm not going to pay more than a few bucks for something i cant try before i buy. Screenshots and reviews just dont cut it for me, so how about Apple allows developers to do x Day trials. I'm sure its possible!

Knee-jerk misinterpretation of the original argume

[iElucidate]

I think most commenters are missing the primary focus of the author's rant. This is fair, because his letter is laden with subtext that is probably not obvious to people who aren't intimately familiar with the iPhone developer community. I believe that the primary thrust of his argument is not that he should be paid more, or that his apps can't stand on their merits, or that he is no longer in a position to play gatekeeper.

Rather, his primary complaints seem to be with the Apple-approved and required distribution mechanism for the iPhone, namely their App Store. The App Store severely limits how apps can be sold, promoted, and used. It does not allow for trial software, it does not allow for returns. There is no built-in help system or feedback mechanism. Ratings cannot be challenged. And the "top X apps" is segregated by "free" vs "pay" but not by different levels of pay. Therefore it is much easier to sell more copies of a $0.99 app and climb the charts, displacing potentially far better but more expensive apps that are naturally going to have fewer sales.

Hockenberry's letter seems aimed at encouraging or nudging in the direction of fixing many of these perceived App Store deficiencies. That is why it is addressed to Steve Jobs, and not to other developers. He isn't saying "stop selling your $0.99 apps," he's saying, give all app developers a fair playing field to encourage innovation and risk-taking.