Apple has emailed developers today that they have made a major change in the way they deal with in-app purchases or downloadable content (DLC). When Apple introduced the idea of in-app purchases, they restricted this to applications that cost $0.99 at a minimum.
Now, they have extended it to free applications as well:
In App Purchase is being rapidly adopted by developers in their paid apps. Now you can use In App Purchase in your free apps to sell content, subscriptions, and digital services.
You can also simplify your development by creating a single version of your app that uses In App Purchase to unlock additional functionality, eliminating the need to create Lite versions of your app. Using In App Purchase in your app can also help combat some of the problems of software piracy by allowing you to verify In App Purchases.
Visit the App Store Resource Center for more details about how you can add In App Purchases to your free apps.
This will result in some massive changes to the scenery of the App Store. A number of questions and possibilities arise. Developers could, for example, completely eliminate a Lite version altogether, and simply provide a Free version with the rest of the content as downloadable in-app purchases. This, however, also changes the dynamic of the top 100 lists. Such an app would be ranked only in the Top 100 Free and may never show up in the Top 100 Paid.