My recent piece on Zombie Match Defense's [$0.99] postmortem, and me saying that it shows why decent games at $1.99 aren't viable for developers any more, seemed to ruffle up a few feathers. This is surprising, because I figured that "it's tough to make money at $1.99 unless you have a really special game and get lucky" seemed kind of like common knowledge. Like, humans breathe oxygen, water is wet, cheap paid games stopped being a good business strategy like 4 or 5 years ago. But I got a lot of pushback from smart folks, so I thought I'd elucidate why $1.99 – and really, cheap games in general – are a bad idea for developers, and why I implore developers to charge higher prices, and for players to financially support games they like, especially paid games that aren't at bargain basement prices.

Mobile games being so cheap once made sense. This was back in the "gold rush" days when the App Store was new, few large companies were involved, and paid games were really the only way for developers to make money, so people that wanted to pass the time had to buy games. It was a legitimate gold rush scenario, and those who got in first tended to do well. Not everyone succeeded, but plenty found a good footing, and you had several stories of people like the iShoot [$0.99] developer who made over $600,000 in one month.

What happened is that as the App Store went on, developers started to figure out that they could price their games at ever lower prices in order to generate more sales, possibly even charting, with a potential increase in sales when returning to the original price point. This quickly became $0.99. Then, developers figured they could draw enough attention and word of mouth to their apps if they went free for a short amount of time, with the bounce back to paid generating enough sales (hopefully) to make up for the free promo time. And it was possible for even decent games of Zombie Match Defense's caliber to at least stay afloat, and allow these developers to build up a name for themselves and improve with future titles. Few people knock it out of the park on the first try. The upstart developers and hobbyists with some talent had a shot. And certainly, I'd like a market where developers who churn out solid games are doomed to making an okay living, instead of doomed to not even coming close to breaking even on their time and costs as they currently are.


But what happened was a combination of Apple allowing free apps to finally have in-app purchases, so apps could now monetize after going free, so what happened was that apps started to just straight-up appeal to people on the fact that they could get a ton of great experiences for no money whatsoever. And there's a tiny marginal value to the average user between "game that is always free with purchases that may be necessary to facilitate your long-term enjoyment of the game" and "game that is meant to be paid that you can enjoy without ever paying, or with optional in-app purchases."

Plus, with more and more developers and publishers entering the market, suddenly the bar to good quality got a lot higher. It took more to stand out, and for many small studios trying to do professional work on limited resources, this becomes incredibly difficult. It also doesn't help that the hardware kept improving, and Retina Displays forced developers to spend more time creating better and higher-resolution assets. This was a natural shift, but one that wasn't making small developers' lives easier.

Pricing also became supremely warped. What do you really expect from a game that costs $0.99? EA would regularly put its collection of games on sale for $0.99, especially around any random holiday it could justify putting games on sale for. Even today, this is an issue. You could've gotten Radiation Island [$2.99] on sale for a dollar at some point, and it's a postively massive, open-world survival crafting adventure game that punches well above its weight class. Your taco stand selling already-cheap tacos doesn't stand a chance if Rick Bayless is undercutting you, while offering Frontera Grill quality right next to you. But that's the reality of the mobile gaming market. It's weird.

Radiation Island 7

Oh and the market decided that it wanted free-to-play so badly that it took over the revenue from paid games over four years ago. The shift in 2013 was so dramatic, that on iOS, 92% of revenue came from free games with in-app purchases, according to a report from Distimo (now owned by AppAnnie). If you think that the balance of power has shifted, realize that according to estimates from ThinkGaming, Game of War [Free] makes over $1.46 million dollars per day. Minecraft: Pocket Edition [$6.99], the top dog among paid games? Game of War makes 45 times what Minecraft makes, and there's several dozen games outclassing what it and any other paid game makes on the App Store.

Paid games lost.

There is a tiny chunk of change available to paid games, since consumers have decided that with mobile games, they don't want to pay up front. And they don't have to because there's so many free games, and so many high quality ones. Meanwhile, someone who thinks that they want to sell games feels like they have to sell at low prices to a market that doesn't want to buy them, And it's not like the paid charts are full of fresh new games, they're full of perennial hits like the aforementioned Minecraft. The majority of the paid games on the top chart? They're games from before 2015.

November 2015 Top Chart

So, you have a situation right now where a small professional developer's chances at succeeding are to pray that their game is good enough to get Apple featuring (and on a slower week, I think Zombie Match Defense with its prerelease coverage and accolades, maybe gets the not-as-good-but-still-valuable end of the row feature on the App Store), manages to click well enough with prospective buyers in that limited time they have to sell the game to them. And maybe if their game is special enough, they can kick around the top charts to make enough money to be a self-sufficient, professional developer.

But you run the numbers, and they just don't make sense. A game that's $1.99 makes a developer about $1.40, let's round up that penny on the 30% App Store cut. A developer looking to go full-time, to merely get above the 2015 US poverty threshold of $11,770 for themselves, would have to sell 8,407 copies of $1.99 games in a year. This is without including the expenses that game development entails, such as engine costs, computers, devices to test on, fees for contractors, and so on. And that's just for a solo developer, any studio with multiple people trying to make money off of games has an even higher threshold to cross.

And you wonder why so many developers take side gigs or just work in their spare time from their day jobs.

Consider also that developers are competing on a global scale. Developers in countries like Vietnam and India, where a dollar goes much further, are also competing with them for space and featuring on the App Store. A dude in Vietnam made one of the most influential games of the last couple years, after all. And a developer in the USA might be at a bigger disadvantage compared to developers from the more socialist European countries, with bigger safety nets due to more expansive guaranteed minimum income programs. It's a rocky playing field no matter what.

And as I said in my earlier Indiepocalypse article, maybe in these conditions, developers who want to go full-time as independent game developers should have a hit before they go off on their own. But, with that comes the catch-22 that it's harder to make a game of great enough quality to stand out and be special when your waking hours are doing something besides making the game that gets you to the promised land of working without pants on.

But what about other price points? $0.99 still has the "it's just a dollar, I can throw that away" feeling to it. This is not for a lot of people, necessarily; any money up front is a huge hurdle to cross. But $1.99 feels like a developer sitting in the worst middle ground. They're asking for more than just an impulse buy. They can't discount to a significant degree – going from $1.99 to $0.99 is hardly newsworthy, and not that much of a drop. Compare this to $2.99, where at least a $0.99 is a couple of dollars, and saving two-thirds of the original price. That feels more drastic. While I've struggled to find empirical studies done on this, I'd be willing to bet that $2.99 games on average gross more than $1.99 games.

Plus, at least with $2.99, there's the need to sell fewer copies than $1.99 to get to the same point, and I think that external factors that drive a player to spend multiple dollars on a game mean that developers can shoot for higher and higher prices. Or at least they should. It makes no sense to sell cheap games when the mass market won't buy at cheap prices. By selling a paid game, particularly one without IAP, a developer is putting a ceiling on how many users they'll get, and how much revenue per user they'll get. At least with higher-priced games, that ceiling can be raised. It's why I'm such an advocate of developers of paid games selling at high prices for the platform: only so many people are gonna buy your game anyway. Why not get the people who do buy in to pay you a fair price for the limited units you do sell? And then, you have more flexibility for sales down the road from $4.99, $6.99, $9.99, and so on. But it is difficult to escape because, yeah, someone will undercut you with a game in a lower price bracket. But that feeling has to be ignored.

Developers can mitigate the risks by making multiple games in a year, but this presents its own challenges. On average, one would expect a game that was worked on longer to be better, of course. And making multiple games in a year is easier with a bigger team, but that requires making more money to keep everyone's mouth fed. This doesn't always mean that a multi-year opus is guaranteed to be better than a game made in a month, especially when we're talking about the fickle nature of art, but a lot of the tweaking and adjustments to a game that can push it from good to great can happen with additional time. But it's time that developers might not have.

The best analogy I can think of is the way that amateur athletes need to be reminded that most likely, they won't make it to the pros. Many of them have that dream, but there's only so many people who have the talent, skill, and drive to play professionally. It's why you hear so many athletes talk about the people who said they could never do it, who always counted them out; because to be real? They had to do so for the people who needed to the grounding in the reality that their dreams are most likely unattainable. Only the strong survive.

Not everyone can make it in a tough market, and I'd rather be honest about how tough it is than to peddle the idealistic delusion that "everyone has a shot!" No, they don't, and so it goes with game developers. Many of them need to realize that yes, they should work hard, but their endgame with game development needs to be to enjoy it and be proud of what they did, not for the checks from Apple to be what puts food in their mouths.

And for the developers who think that they have what it does take, that they have the talent to thwart me? People like Folmer Kelly, who always gets mad whenever I write something about this topic, and who I respect immensely for trying to prove the haters and doubters like me wrong? The thing is, there's only so many people like him who can hustle enough to thrive in this market. But they do exist. They're just the minority, almost a rounding error in a world of vast competition created by the death of scarcity. And I sure hope they go on and prove me wrong. Trust me, I'll enjoy the games they make, I'm sure.

But what everyone needs to realize is that right now, on mobile in particular? Where there's millions of games, thousands and thousands of developers, and the idea of value is so skewed that a fair price for the work of developers to sustain themselves is practically unattainable? It doesn't work.

  • RossmanBrosGames

    The ones who care the most will tell you the truth. We're gonna keep shooting to make games that you all love, but are thankful we don't need to feed our families with it. Nice article Carter, you're not trying to be a downer, if anything I'm actually encouraged by your care for us indies that comes through in your article. Perhaps we might make a title that catches a large audience, however we are proud of the fans we have here in the TA community. At the end of the day our reward is we get to make games, just not gonna quit my day job 😀

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  • XperimentalZ Games

    Interesting editorial as usual!

    Over the last 5 years, we've tested all sort of monetization models and from what we've seen, they're all equally difficult to succeed with.

    Surprisingly, the download vs price curve is almost linear (though I'm sure that there's exceptions to that), which means that if you slash the price in half, you get twice the downloads and the same income. This is also true for lightly monetized freemium model, you might get 25 more downloads when the game is free compared to 0.99$ but if the game brings you 4 cents per download, it will still even out.

    Of course if you manage to get a better average income per download, this can be a game changer. However, it seems to gets exponentially more difficult to increase your income per download. If you're looking at a model that will bring you over 25 cent per free download, you might end up spending more time on monetization than on the game itself. Of course AAA freemium monetization models are very hard to construct due to their 'mmo-content-like' structure.

    So, supposing that a game as a perceived value high enough to actually do ok when it's priced or highly priced, you actually may have an advantage to price the game as high as you can at launch (as Carter is suggesting) and then decrease it gradually because you'll have layers of monetization in reserve, as opposed to launching a game for free: if you miss, it's kinda over. However, there's a grey zone. Developers lucky enough to hit this magical zone where the number of download is high enough and the gameplay viral enough to produce self-sustainability (self-regenerating user base). In this case, launching at a lower price can be an advantage.

    Even for quality games, the battle can be long just to break even. Developers jumping on the train should do it out of passion before anything else.

  • stalfosknight

    Go f- yourself, Carter. Your IAP apologism does nothing to help cure this cancer on gaming.

  • TripMX

    Personally, as a user, all I ask is that when developers decide to make FREEMIUM games, please don't require us to have a constant internet connection just to play the SINGLE-PLAYER campaign/missions/game; for IAP, Multiplayer, etc., a required connection is totally understandable. If the game is a pure MMO, then of course, the need for the constant connection applies.

    Now, you should all know that the FREEMIUM model is intentionally imbalanced. Many FREEMIUM games have 'store' items that only give abysmal stat increases (like +1%), which doesn't make the player feel much better about his/her purchase; Gameloft is notorious for this BS. Devs should offer more interesting unique items in the 'store' or via IAP that have abilities or effects that cannot be obtained anywhere else in the full game, thus giving good incentive to purchase....also, make these items USEFUL, not just cosmetic. Enhancing player experience is important. Do away with all STAMINA systems because THEY ARE ANNOYING AS HELL; why frustrate the player even further than his high premium currency cost +1% damage upgrade? Make worthwhile items/equipment or just don't make them at all.

    On another personal note, I'm one of the people who are willing to pay high dollar for high quality games. I remember when SNES cartridges were $60 in stores; I'd save up and buy the full game, which often resulted in a VERY satisfying experience; games were usually balanced, no IAPs, no gameplay time limitations (like STAMINA/ENERGY timers), no requirement for internet connections, etc. These games were cherished, and I still have some of them in my current collection even STILL! If the developer can make a good game with good intentions, and at the same time, focus on quality for the consumer/players, the game should turn a profit.

    Gameloft is a developer with monetary intentions, as most big companies are, but the difference is Gameloft believes that "catering to the customer" is a theory. I don't care how high quality AAA-like MC5, DH5, etc. are, if the game is 90% structured for the money, how the hell am I going to enjoy playing a game that "imprisons" players to waiting for the ability to play again? They want to catch the "high paying players"....that's where the profits are critical (pay-to-win scheme), but whatever happened to playing a game for pure fun? They're making the money anyway and I'm just ONE consumer, so what's the use of my rant towards them...greedy bastards.

    • David Castejón

      Nice point of view. I also prefer buying games at a high prize (if they deserve it) than having to buy millions of mini things to enjoy the game in long term conditions.
      And trust me, I work for Gameloft and they do not seem to want to change this system shortly 🙁

    • hkiphone

      Very good point to raise, thank you. Lots of IAP seem o offer the same flavours, like enhanced combat, recover quicker, more loot etc. Could you detail what kind of IAP you found to be most worthwhile and fits your expectation of being useful? Unique and balances the game? Cheers!

      • TripMX

        Enhanced combat, quicker recovery, more loot, etc. are the basic essentials. Devs can include IAPs that could have spectacular effects and/or stats that when the player would see other people use (maybe via video or word of motuh) it/them, they'd most likely would want the same thing, and eventually end up making the purchase, especially in a FREEMIUM (unbalanced) game.

        FREEMIUM example IAP suggestion:
        -Instead of a timed potion that adds +1% to ATK,
        +Add a potion with permanent effect +1% to ATK
        (FREEMIUM players want to be strong (*very strong) in an otherwise unfair model)

        PREMIUM example IAP suggestion:
        +Add a weapon, a sword for example, that has a special attack that will cause the screen to flash, then in a single brilliant move by the wielder, all enemies on-screen would be instantaneously sliced in half (all rock pillars in the vicinity would be sliced as well, as an added visual effect). Of course, this weapon's stats would be decent enough for the purchase as well as balanced for usage (eg. special attack conditions or charge gauges).

        +Add a magic spell that would trigger a spectacular cinematic sequence (think Grandia II) that would result in the enemy (or enemies) being obliterated in style, giving us players a feeling of gratitude or even remorse for the victim; the spell should also be strong enough (perhaps not game-breaking if conditions are in place) to warrant a purchase. We'd want to buy that IAP.

  • Jay Gaming

    i always buy useless iap now to support games that I like and are hard to find . For instance I support all clickers that I like because it is a genre I prefer.

    • Adams Immersive

      If you like useless IAPs (nothing wrong with the ol' Tip Jar!) I have some IAP ideas I've been toying around--absurdities that might sort of fit with the right kind of silly game, as long as they could be toggled off. My favorite and most absurd idea:

      More Ads ......... $0.99!

    • XperimentalZ Games

      We've fooled around with indie support IAP and ad disabling IAP in game like Platforms Unlimited and Mechanosaur Hijacks the Moon. There's like 1 people on 1000 or 2000 buying them. They're more useful as token of good faith demonstrating that you're trying to go for a fair monetization model.

  • jin choung

    articles like this are totally flawed because they don't acknowledge that it's hard to make money with FREE games too! nobody but the lucky top at the few make any money. so why defend the lucky blood sucking leeches gaming the psychology of players over people who just make fucking games?

  • h4nd0fg0d

    Always love the CC write ups, but I must say that Zombie Match D was a very weak ass game, imo. Nothing top notch or stellar about it, mundane as hell, period.

    • iOSgamester1980

      I was reading the Zombie Match Defense developer's blog explaining his point of view after the first write up on his game's failure was published here, and one of his admissions was that he named it primarily based on searchability. Sorry, but if you want your game to go viral then just make it good and give it a unique name. Dont let gaming the system inform important decisions about your product like that.

  • WaveLightGames

    Good article in my view. We launched a decent game (Demon's Rise - reviewed at 4 out of 5 stars by Touch Arcade) at 2.99 and have only made around 6K in total revenue. Not a huge problem as we all have day jobs but we definitely learned a few things that we will take with us in our next launch.

  • BaronKrause

    But there is "Good" Free to Play (LoL/Dota 2 style) and then there is screw the customer, money grab Free to Play with Gatcha systems replacing what would be endgame progression.

    The former is great, even energy isn't bad (though it does make the game reliant on their server still being up, which it won't be as soon as the IAP slows down).

    The latter is the kind destroying mobile gaming. They both are proven systems that make money, but the gatcha system just makes more of it. Which while you can't fault a developer for wanting, you sure as hell don't need to ignore it. Bad press is supposed to be the counter weight that companies weigh against practices that are higher profit but anti consumer.

    If gaming press just keeps giving them a slide, then they have no reason to ever not go for the highest profit/screw you tactics when deciding on a pay model.

    • Adams Immersive

      Agreed, F2P can be done perfectly well and have no objection from me. But only for certain KINDS of games.

      So, F2P limits the breadth of gaming that can be successful. Such is life!

  • Adams Immersive

    My first game (Scree) will have ads (unobtrusive and therefore probably not paying well). And a premium disable-ads option that I know, statistically, almost nobody will actually use. I don't mind how this has turned out!

    But that depends on the game. Other games I really care about making would be far worse with IAP or even ads. It would be like asking a filmmaker to slap ads in their movie! Sadly, that may mean these games cannot exist (there's only so much hobby-time to spend giving games away free), or else the artistic vision will have to be compromised greatly.

    But I will not shoot the messenger! Carter's dark and grim crater speaks much truth! And I'll keep making games—just not as many as I could if it were a viable business. (Unless of course I get lucky, but I'm realistic about those odds.)

  • elthesensai

    It's not hard to see why that piece "ruffled feathers". Free to play is a race to the bottom. Games are becoming undervalued and free to play doesn't help. Another thing is you'll never make a hardcore gamer buy into free to play. Call of Duty, Legend of Zelda, Mario Kart, and loads more cant be sustained on that model. Free to play caters to casual gamers and that's it. It's the new Facebook game or shovelware before that. If iOS is to be taken as a serious gaming OS it's going to need to convince gamers that it's okay to buy $50-$60 games as well as free to play or we may have to kiss our industry goodbye. (Or more realistically consoles and pc will be the place to play "real" games while mobile games will continue to be super casual) By the way great article! Hopefully more mobile gamers will understand this.

  • Jay G

    I would have paid the developer of Radiation Island $30 - without hesitation - for a PC version (and WILL if it ever comes to that). I think it's a matter of putting your games in the right place, if you're going to charge premium prices, put it where the market is most open to your type of game. It probably did okay at best, because $2.99 was, and is, a ridiculously low price to sell that quality of a game for at launch. I don't like playing that many hours on a handheld device, but I would have paid them MUCH more than $3, even if I only played an hour or two. (I'm old, too much portable gaming at once, and I can't move my neck for a day)

    • Earth Vs. Me

      Yes, exactly. Mobile is the worst possible venue to release a premium priced game. Steam on the other hand, is a dedicated community of core gamers who value premium experiences.

      • Jay G

        Well, that's not exactly what I was trying to say, I was just giving the example that this one game in particular, probably would have been better served by releasing into a community that buys survival/crafting (horror, I guess?) games like mad, and routinely pays 10x the price they are asking for it on iOS.
        I'm trying to say, that I think the developers should have put a little more thought into where their core audience might lie, and what format suits the type of game they have the best...NOT that every premium game fits this criteria and shouldn't be released on iOS.
        Radiation Island, is a unique, phenomenal game, that is drowning in a sea of "me-too" and f2p games.

  • DanCJ

    You really missed the point of the naysayers to your other artical Carter. People weren't denying how hard it is in the App Store. They were mainly dismissing your use of an (apparently) unremarkable yet another matche three yet another zombie game as an example of anything.

    Your main point in this artical seems to be that (once again) it's really hard to make any money in the App Store. We know that. No-one is denying it. There is some evidence that F2P makes more money than paid (though how true that is once you get outside the top 50 I don't know), but as far as I've seen nothing to suggest that increasing prices of paid apps will make any difference. (I'm not saying they won't - just that I haven't seen any evidence. XperimentalZ Games's post in that regard was very interesting)

    • bilboad

      Yeah, my main problem with Carter's articles on this topic is that while his opinions often seem plausible, he doesn't provide much evidence to back them up, yet he states his opinions as if they were obvious facts. If anyone calls him on his lack of evidence, he brushes them off as haters who just don't want to hear the truth. I'd respect the articles more if he was more up front about these just being his unverified opinions.

    • ALB

      I think there is a general lack of developer statistics available in the industry. Occasionally developers will post in the TA forums with some download stats and maybe even a little profit info, but over all, it seems there isn't much beyond game rankings out there. I know the TA staffers PLAY a lot of games and TALK to a lot of developers, but this article could really use some hard evidence to support its claims.

      I think both this article and the one before could pretty much be summed up as: "indie developers have a one in a million chance of success in the App store today". I don't think either article was really making a case for freemium games or even for high-priced premium games being the most profitable way to go, because both of those models have a lot of problems for indie devs (which Carter pointed out). So they might read as "downers" to developers with big dreams.

      Indie devs are looking for ways to stand out in the App store, innovative ways to conquer this marketplace and succeed against the big name/big budget companies. It seemed like Carter's conclusion was that they can't. That they should keep making games for the love of the craft and as a passion project, but don't expect a paycheck out of it.

  • lena98765

    As people have said in the previous thread and as people are saying now: you ignore how hard it is to make money with free games. I wish this article touched on that by comparing how many players a F2P developer would need to make minimum wage and how likely that is to happen for a typical okay but not great game (which is how you described the zombie match 3 game). I often notice that even free games only have a few thousand players in the leaderboards and some have even less. To get those hundreds of thousands of people who keep playing your game (and keep watching ads) is not easy either, especially with a good but not really special match 3 game, even if it's free. And of course it's a dying industry with ad blockers on the rise, so while ad supported free games may do kind of well for now for those devs that got lucky enough to get the amount of downloads and retention necessary to make money from them now, it does not mean it's wise to count on this to continue happening for a long time. To make money from whales who buy expensive IAPs you need an even larger amount of players which is really out of reach for small indies.

    Also, I have no idea about the US app store, but in my App store the top grossing apps are all free, but they're all old games too. Candy Crush Saga, Hay Day, Game of War, Clash of Clans, Hearthstone, etc. In fact, there are way more new paid games in the paid top 10 (The Room Three, Myths of the World, Lego Ninjago, Skywars, Minecraft Story Mode) than there are new free games in the grossing top 10 (which I think is more relevant than the free top 10 since the topic of this post is making money). I don't think those top charts are interesting when we're talking about indies (my small business isn't in any top 100 list either and that's okay), but if the fact that the top paid games are mostly old games is relevant, than the fact that the same is true for the top grossing games seems relevant too.

  • Tommmy

    What a tonload of dumb morronic bullshit.

  • Pray For Death

    In the case of Zombie Match Defense, the uninspired name and 2005-flash-games art doesn't do the game any favors. It may have good underlying mechanics, but it frankly just looks flatout terrible judging by the trailer and screenshots.

  • DanCJ

    People have been saying the same sort of thing for decades. It wasn't true then and it isn't true now.

    • Schpank

      It's true for some in some sectors, but it's cyclical.

    • Tom Swayer

      capitalism is a failure
      art for art's sake

  • Schpank

    Paid games may not work for developers, but they work for consumers. Your posts seem to be developer-centric tales of caution. Dire predictions of industry failure unless we figure out a way to somehow support MILLIONS of developers. The App Store represents the ultimate in overproduction and overcompitition. It may be harsh, but entertainment has always been a blockbuster, top of the heap, winner take all affair. Does that mean many games/devs will fail? Yes. Is it a shame because we might miss out some on truly great stuff? Yes. Hate to say it, but instead of pushing schemes that may or may not increase profits for developers en mass, at the expense of consumers, maybe we should let the herd get culled.

  • SpaceTiger

    I still don't understand why more devs don't use a shareware model. Let me play the first section of your game for free, and then if I like it I will buy the IAP that unlocks the rest of the game.

    I will download free apps and try them all day long, but I'm not dropping upfront cash on an unknown.

    For example, there is a turn based strategy game that I want to try but I'm not going to drop the 6.99 asking price without trying it.

    This would be the equivalent of demos on the Xbox and play station... I download a lot of demos and then buy what I like.

    Any devs out there tried this? I downloaded the app Tactics Maiden for free on a whim, liked it and bought the IAP to unlock the full game.

    • XperimentalZ Games

      Again, there's no 'best' approach since that depends very much to every game, but this model was tried as soon as IAP became available on the App Store. In fact, way before, through free version to paid version conversions.

      I think it got tossed aside because it was less efficient. Compared to the paid model, if your game is well presented you can often end up with more conversion off the bat than conversions going through the demo funnel. Compared to the freemium ads model, it can be typical to have a 1% conversion on a 0.99$ IAP, which means 1 cent per user. Ads can easily drive 2-3 cent per user with few effort, and you have 100 times more people engaged and talking about the game.

      But I'd like to reiterate that no monetization model should be put aside, they can all work with the right situation and planets alignment.

    • Michal Hochmajer

      Deep dungeon of doom(Android version). Not perfect example, as they were selling just final endless dungeon. Rest of the game was free(story driven dungeons). But for me, this system worked flawlessly. I would miss this gem if they charge for full price. Of course, I bought final dungeon(evidently minority), but they switched pretty soon after release to premium model.
      Implosion by Rayark (Android version 1.4 GB?). Problem is, that many people complain about it. In case of Rayark, which is trusted Dev with solid fanbase, they were over it. But imagine yourself as indie one man show building new fanbase. This situation can easily brake your neck.
      You are right, it is great system indeed. But too risky, if you are trying to establish business on this "wild" market. I didn't mentioned many other important things in these two examples, cuz this post should be too long. Like 1 hour long talk.

    • Carter Dotson

      Everything I've seen and heard on the model is that the conversion rates are so low, and your revenue ceiling is so low, that you need a large number of downloads to make a decent amount of money. And if you can get the downloads, then it's worth doing the consumable IAP thing.

  • Yaelle G

    Am I the only one who is majorly turned off by F2P?
    The best example of this that I can think of is how Popcap sold out to EA (shudder). Plants vs. Zobies 2 might be amazing, but the fact that there are potentially limitless IAPs turns me off SO BAD.
    I always look for the Pay One Time and Leave Me Alone games because I know the chances of getting screwed.

    In the case of Soda Dungeon, which I discovered last month, I'm so pleased by their non-douchiness that I made some IAPs.

    But then I guess it's usually the ones who don't need the $$ who demand the most.

  • GreatWizard

    I have a small utility app that I priced at 1$ first, and then at 3$. Sales dropped about 30%, which makes it a clearly profitable move. (needless to say, the app is a side project, and I'm not sure it ever paid for itself/development time etc).

  • Michal Hochmajer

    Thx Carter. Good article and perfect discuss below. People pointed out some "glitches" in your way of thinking. And I agree with some of them. Also, maybe we are more financially "stable" in Europe, but paying social and health care (which is must have in my country, when you have any income) is overheading sometimes. You are UK right? Anyway, thank you very much for your work on TA.

  • XperimentalZ Games

    Dropping in for a final comment. I saw from App Annie that Zombie Match Defense was not featured by Apple on launch. Given the quality of the game, efforts put into marketing and statistical odds of feature in such a situation, it was sheer bad luck. A feature would have yielded a few more thousand dollars on launch week (the final number depends on a number of factors).

    Being featured by Apple as a decently monetized freemium game is usually more lucrative than as a paid game (just taking account the launch period, not the lifetime value).

    However, not being featured, it's usually easier to raise funds as a paid game (it's a better ground for fans-powered sales or direct sales), which means things would probably have been worst as a freemium launch. Featured or not, considered the game they've build, I think they've taken the right decision to launch as a paid game. They'll probably come across many future opportunities if they stay pro-active.

  • James

    As long as your game is free to play you won't get my money. Make a solid premium game and I'm yours.

  • Martin Meier

    I am not saying the following thing in a need to offend anyone, I want to state a fact that's more than obvious:
    a lot of mobile gamer are bigots. Perfect bigots.

    And this hurts a bit to say, but I am one of them - at least occassionally.

  • Tom Swayer

    its pathetic how many people just jailbreak their devices so they can get everything free. I saw a Dev explain that they can track how many times their game is installed vs actually bought, and you can see all of the piracy taking a run on these indie games. Its PATHETIC. I am living from paycheck to paycheck and I still have spent about 300$ since christmas on IAPs and Full Games. "

    It's sad what the industry has to deal with, and the guy who said mobile gamers are bigots is right. When it comes down to it, alot of people just pirate and pretend to care about the integrity of the designers and the time spent.!

    Honestly--- I'd prefer that the games get more updates and more attention. So therefore I recommend that you find a way to make these micropurchases or IAPs worthy. You'll have to fight piracy of course by not selling the full game immediately, but if that increases revenue and spurs on development of the game and updates, I am ALL for THAT.

    Support the games you love!!!

  • Supaflyindie

    As Carter mentioned, I think the fact that the Paid Charts is less volatile is a actually good thing for premium titles. i think this simply gives quality premium games more room to shine and hopefully generate a consistent stream of revenue (if they are able to make it to the top of the charts). I think F2P is a science for big developers and more like a lottery ticket for small indies