Why is the minimum app store price 99c/59p?

Discussion in 'General Game Discussion and Questions' started by ian1969uk, Jun 18, 2009.

  1. ian1969uk

    ian1969uk Well-Known Member

    May 31, 2009
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    Does anyone know?

    This wasn't a problem when it was games being downloaded, but I can see it being an issue if every single in-app purchase has to cost at least 99c/59p.

    Is there any reasoning behind this figure?
     
  2. starjimstar

    starjimstar Well-Known Member

    Sep 28, 2008
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    Simplicity.

    Can in-app downloads not be free?
     
  3. ian1969uk

    ian1969uk Well-Known Member

    May 31, 2009
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    I don't think they would have gone to the bother of introducing micro transactions in 3.0 if they were about to make them free!
     
  4. jawslover

    jawslover Well-Known Member

    Dec 28, 2008
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    I think he means to make them like $.50 or $.25.
     
  5. Zwilnik

    Zwilnik Well-Known Member

    Mainly because any lower and the credit card handling charges would make the transactions unprofitable. As it is, Apple doesn't make much at all from the App Store.
     
  6. Kamazar

    Kamazar Well-Known Member

    Dec 13, 2008
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    Anything less than 99c is pointless. Neither Apple nor the devs would profit, and honestly, not even arcade games at movie theaters are less than a dollar.
     
  7. xVietx

    xVietx Well-Known Member

    Jun 9, 2009
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    Do you mean with the entire app store? While it's true that they get 30% of all purchases and that might mean little, take all of the priced apps combined with 30% and you would have a small fortune right there.
     
  8. jchampl

    jchampl Well-Known Member

    on the 11th day God said "all apps must be sold at a mininum of 99 cents, with 1 dollar increments, unless free" and so it was to be that all apps start at 99 cents.
     
  9. Eric5h5

    Eric5h5 Well-Known Member

    Most or all of which goes to infrastructure and support costs. There's a reason why developers usually get more like 30% in setups like this (for example, online game portals), not 70%. If Apple wanted to be making a reasonable profit on the App Store, they'd reverse the percentages they currently have. Instead, they use it as an incentive to get people to buy the hardware, which is where they make the profit.

    --Eric
     
  10. Prab

    Prab Moderator
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    Dec 17, 2008
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    Apple is known to be pretty stringent about how they price their products (think iTunes and the whole NBC issue). So I think 99 cents just makes it easier for them to calculate their expected profit (lower bounds etc?).

    Any statisticians here? I could be wrong lol :p
     
  11. gunghir

    gunghir Well-Known Member

    Jun 17, 2009
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    lol apple does it for free so they sell more iphones


    SUURE :D:D:D:D
     
  12. gunghir

    gunghir Well-Known Member

    Jun 17, 2009
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    hey isn't that steve on an unicorn overthere ?? :eek:
     
  13. Eric5h5

    Eric5h5 Well-Known Member

    It's correct. This isn't something I made up; you can find many explanations and analyses of this elsewhere. (Also, they don't do it "for free"; they make enough to cover costs.) The same way they make hardly any money off music; they only have the iTunes store to sell iPods. Apple themselves say this.

    --Eric
     
  14. NickFalk

    NickFalk Well-Known Member

    Seriously?
    I find this quite hard to believe. While there are substantial costs involved creating and maintaining the App Store I'm pretty sure Apple is making a profit from it by now. Initially the story might have been different, but the volume sales should most definitely guarantee a nice surplus on the bottom line by now.
     
  15. nizy

    nizy Well-Known Member

    The other interesting thing to consider is the ridiculous cost of the infrastructure: servers, bandwidth, card transactions, marketing, maintenance and the like that is required for the iTunes store. I mean the bandwidth required is just plain staggering - think about the shear volume of customers downloading music, movies and apps! :eek:

    Besides, with DLC, you will most likely get a few items for your $1, Gameloft said Asphalt 5 will have a 1 new car and 3 tracks...That sounds like quite good value to me. :)
     
  16. Eric5h5

    Eric5h5 Well-Known Member

    Yes. :) Here's an article: "Steve Jobs said when he opened the App Store that it was designed to merely break even — and he probably meant it. The apps, which can increase the utility of a mobile device exponentially, are there to bring in users. The profit for Apple — as usual — is in the high-margin hardware." This estimates that Apple hasn't made any more than $20-$45 million from the App Store, which on the low end would barely cover estimated costs. Another article, another...doing a search finds quite a few along these lines. I read another article more recently (can't find it at the moment) that had a more detailed break-down of estimated costs, which was pretty convincing in having Apple only breaking even, or possibly even operating the store at a small loss.

    --Eric
     
  17. Trotgar

    Trotgar Well-Known Member

    May 9, 2009
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    In-app purchases are a good thing if they have enough content, because with them, devs don't have to make new games all the time, they rather improve the old. I'd rather have one good, deep game than ten shallow, unfinished games.
     
  18. iReview

    iReview Well-Known Member

    May 25, 2009
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    Simply put, it covers and maintains their App Store. Apple is a hardware company.
     
  19. daveak

    daveak Well-Known Member

    Yes they can be free, they just don't use the new feature in 3.0 and fetch the content from the devs own site instead, same way TTR put new tracks up every week for example.
     

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