The App Store is part of an emerging market and this is what emerging markets look like. I'm barely old enough to remember going to computing shows in the mid- to late- 1980s. The kind of warez being pawned off at these shows for $5-$10 was embarrassing too. There were some terribly bad games and software being made back then. What tends to happen is the market itself, at first, is exciting and people will buy anything. Once the market itself is no longer fresh, the buyers tire of the level of quality and become more discretionary and discerning in what they buy. Hasn't anyone had a new mall or shopping strip open up near them? People flock there for no reason whatsoever except that the experience is fresh. Once that fades, only the good stores survive.
The App Store is no longer fresh and exciting. Sorry if your business plan of putting a piece of crap on sale there at $0.99 doesn't work for you now. The best software is yet to come. There are folks working on quality pieces of software and you'll see prices trend higher with the number of developers trending lower over the course of the next few years. The sweet pricing spot was $0.99 in the first year of the App Store. It'll be an order of magnitude higher in two years. I'm fairly certain about that.
> It'll be an order of magnitude higher in two years.
By the time market forces have gathered to encourage this shift, the landscape will be radically different.
The platform can only be locked down for so long. Most, if not all, mobile devices will be doing what the iPhone can do now in about five years. High-jend phones already do, and just like with camera phones, it will take time for the features to trickle down to the budget market.
With an expanded market, mobile software will be pirated just as desktop software is today. Because the usability of the device implies connectivity, this piracy will be more user-friendly, sophisticated, and streamlined. This will absolutely clobber the $0.99 app market.
The author of this article is really trapped in the Apple Bubble, and while his grievances are legitimate and well-argued, they'll be irrelevant very soon: Price controls like Apple's can't legally exist throughout an industry.
> Most, if not all, mobile devices will be doing what the iPhone can do now in about five years.
I'll concede you that. But (if S. Jobs is still in the saddle), can you imagine what the iPhone might be doing in five years? [I, personally, am not able to.]
I bought a 1G 5GB iPod in 2002 that worked better than my current 5G 80GB iPod purchased five years later, in 2007. The interface is about the same, but everything is slower. I thought that something was severely wrong with the iPod when I purchased it because the menu interface is slow, verging on unresponsive, whenever music is playing.
Apple has had so many chances to make the iPod a better device and has chosen not to, so I'd be surprised if they improved the iPhone significantly.
Consumers want cheap apps. Don't blame Apple over that. It's entirely possible there is no market for $10 games by big studios. Meanwhile a tiny studio can write an app like Flight Control that is insanely popular. What were their development costs? Next to nothing I suspect. They understand what consumers want. You can't blame consumers, or Apple, if you're trying to sell a $50 steak at a fast food restaurant. It's not going to work and it's your fault. You have to understand the market you're trying to compete in. You don't see many console game publishers releasing $90 games do you? The acceptable console price is $50-$60 (unless it includes hardware ala Guitar Hero) You don't see Coke selling a $10 soft drink because the acceptable price point is <$2.
The problem with the App Store is that the display model is too simple. Think of a real online store, namely Amazon: sure, they have categories and you can find stuff by category if you want, but categories are tertiary at best.
The primary driver is search. If you're installing an app, you're probably looking for something that does something specific. App store's search is rudimentary. All that stuff is server side; they could implement "customers who looked at this app 90% of the time eventually bought...", just like Amazon does.
The secondary driver is recommendations, both editorial and automatic. The editorial side is pretty good. But Apple also knows which apps you've already downloaded, so it's in a perfect position to say "customers who bought this app also bought". It's just Genius for Apps -- they clearly have the technology already, it's even already in iTunes.
The result of these omitted features is that the only way to get noticed outside of being editorially featured is volume -- and this promotes a race to the bottom, both in terms of price and in terms of appeal (hence iFart and a thousand other apps that are just gags for idiots to blow 99 cents on).
So it seems the iPhone model really seems to favor a shareware-style development and deployment environment. "Pay for 5 more levels" or something to that effect.
The App Store is no longer fresh and exciting. Sorry if your business plan of putting a piece of crap on sale there at $0.99 doesn't work for you now. The best software is yet to come. There are folks working on quality pieces of software and you'll see prices trend higher with the number of developers trending lower over the course of the next few years. The sweet pricing spot was $0.99 in the first year of the App Store. It'll be an order of magnitude higher in two years. I'm fairly certain about that.