The yardstick for mobile games
For better or worse, we’re seeing enough quality apps for US$0.99 that people are less willing to pay much more than that for anything. More and more, you see comments in the reviews section from buyers that feel ripped off by games that cost less than a coffee at Starbucks, such as “I can’t believe I just paid US$2.99 for this crap. Do not buy. I’ve played free games better than this.” As many people have noted before, all this doesn’t bode well for Nintendo or Sony in the portable gaming category. To get people to pay US$30-US$40 for a title is going to get harder and harder–even for AAA franchises that have traditionally sold millions of copies. The fact is that a US$25 iTunes gift card goes a long way for parents having to fund their children’s gaming habits. You’re looking at supplying your child with a dozen or more games versus one. That’s a big difference.
As a consumer, you have to like where all this is going. From a developer standpoint, things become trickier. Yes, if your app’s a big hit in the App Store, you’re going to rake it in, even if it sells for US$0.99, because the market is so large (at last count, about 65 million people owned an iPhone or iPod touch). But you also hear plenty of stories of developers who invest good money in creating an app only to see it virtually disappear and earn almost nothing. Will the price erosion ever stop? I think the only way for that to to happen is if Apple raises the minimum price that someone can charge for an app. It may just have to do that someday, because the competition among developers is so fierce that if Apple set the minimum price at US$0.99, you’d see plenty of app makers rushing to lower their prices.
