Good for Consumers

“Good for Consumers”, is a phrase often heard in association with falling prices, more competition and more choice. With the App Store, plummeting prices can be regarded as good for the consumer, but I don’t believe that it is, at least in the long term. Though I know that there are many people much smarter than I working at Apple, and on the App Store team, I feel that they are even short sighted in this regard, putting aside the long term sustainable practices for short term growth.

As a consumer, I very much enjoy the ability to get high quality apps for free or extremely low cost, and indeed, if you take a look at the top grossing chart in the App Store, you will find that in the top 100, there are only 14 apps that charge up front. While this is a great thing for Apple, and also “good” for consumers, in that they can get nearly any app they want without paying a dime, it is only good in the short term. The problem comes when you start to consider the effect that these extremely low prices have on independent developers, and on their future in the App Store.

With nearly all of the top apps being free, you may be excused from thinking that independent developers out there are building apps with the sole purpose of “delighting their users”. No developer (unless it is purely a hobby), develops an app simply out of the desire to bring delight to users. They build for the purpose of making money, as delighted users are not very good at paying a mortgage. So developers make apps to make money first, and if they are not making money, why would they care about the quality or users experience of their app?

Prices have not only affected developers, but user attitudes toward developers. Users not only expect incredible apps, while having no idea or appreciation of the effort and engineering required to create these apps, but they also expect their apps to be free. Worse even than free though, is that app upgrades are free, and Apple provides no mechanism for charging customers for upgrades. This is, in my opinion, one of the worst practices of the App Store. Where else, or what other industry, can you not only get something initially for free, but even get all future versions for free as well?

At this point, most user’s are deriving substantially more value from the apps they have then the developers are getting from their users. And while it is great to deliver value to your users, you also have to derive value from them. What should be a mutual, healthy relationship where both parties provide value has been turned into more of an abusive relationship where the users take all the value from the relationship without providing any themselves. And this disparity of value is the crux of the problem.

Developers who are not making money will not build quality apps, and poor quality apps are not good for consumers, Apple or anyone. The problem for Apple is that, for the most part, independent developers build platform defining apps. No one gets an iPhone to get apps from Google, and iWork and other Apple apps don’t provide a huge draw.

Apps like Paper and Letterpress are platform defining apps. These apps were built by independent developers, and without theses developers, there won’t be anymore of these apps. Google or Apple is not going to build the next Paper or Letterpress. And game companies like EA, while they build popular games, make them available on Android as well.

So why does Apple not provide better ways for independent developers to monetize their apps? Perhaps they think that they have an infinite supply of independent developers they can just churn through because the platform is so popular. Maybe they think that there is no problem, and the $10 billion that Apple touted as payed out to developers at WWDC is enough. Or maybe Apple doesn’t think that they have any responsibility to provide anything for developers other than an SDK and the App Store shelves.

We don’t know what Apple has planned or what they think, but they certainly don’t seem to be giving any indication that they are worried about about independent developers. Even a very simple step like providing an avenue for upgrade pricing for apps would go a long way toward helping the problem, and it would be good for consumers, even if they did not like it initially.

While many things Apple does are touted as, and indeed are, good for consumers, their handling of the App Store and the resources provided to developers don’t seem to indicate that they understand that doing good to developers, even if it led to more sustainable (read higher) app prices, would also be good for consumers. At the end of the day, delighted developers build incredible apps, and incredible apps lead to delighted users.