Filed under: Rumors, App Store
Are iPhone app devs getting a raw deal?
We mentioned yesterday a rumor that Apple won't cut a check for iPhone application developers until the dev's share of the sales tops $250. A lot of commenters were upset about this, if it's true: TomWBrowning said "So if you make an app that costs $1 you won't see a penny even if 359 people buy it?"
From the (indie) developer's perspective, this stinks. They've already paid at least $99 just to participate, and now they have to wait until they make (potentially) hundreds of sales before they see a dime from Apple. Will the high barrier for entry discourage truly good app development? Or will it act like a cover charge to keep out the riffraff?
From Apple's perspective, this is just good business sense. It costs money to cut checks and make electronic transfers in quantity. Plus, Apple can aggregate a great deal of interest on all those little sums they have tucked away. Their cut -- effectively -- is probably far more than the advertised 30 percent, depending on how smartly they invest their savings.
The model isn't exactly foreign: Google AdSense makes a great deal of money (on paper, at least) on the backs of smaller sites that don't earn the $100 minimum for Google to cut a check. Some commenters were suggesting that a $50 threshold for iPhone apps would be more reasonable.
In any event, it certainly makes ad hoc distribution look more and more attractive.
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Reader Comments (Page 1 of 4)
Dave Wood said 11:18AM on 6-27-2008
Make sense what Apple is doing business wise, and if a developer is investing the time to build an app, he better hope it makes him more than $250 or why even bother charging for it!
Plus Apple could just implement a policy of $250 minimum, but you get a cheque at least every three months if your owed at least $10.
This sounds like just a reason to complain than anything substantial.
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MoonMan said 12:08PM on 6-27-2008
Of course Apple won't cater to a bunch of whiney kids that think that such a small amount is significant. If an app can't make at $250 in sales, then it doesn't belong in the App Store. Apple should also implement quotas, if an app doesn't hit certain sales targets on a quarterly basis, then it gets removed from the App Store.
I want good quality apps developed by experienced companies, and not some kid in his mamma's basement.
I agree with Dave Wood, this sounds like just a reason to complain than anything substantial.
Jaioxung said 12:42PM on 6-27-2008
I agree, this is a business, Apple has to find the best way to please its devs while maximizing its (apple's) profits.
One negative effect of this, at least to the consumer, is that small, independent devs might decide to charge more than they originally planned so they have a better chance of getting paid. It might take a while to meet your quota at $1 but at $5 you cut that time down considerably.
Josh said 3:51PM on 6-27-2008
Moonman
Some of the best software in the world has come from "kids in momma's basement" ... those are the ones that do it because they love it, not because some corporate shareholder is breathing down their back.
FunkyJohn said 5:11AM on 6-28-2008
Josh: And what application would that be? Do you have any examples for this claim?
Rubbinz said 11:28AM on 6-27-2008
I'd personally like to see the minimum at around $50-100, because I know a few indie devs that are making some small fun apps they want to share. Their initial thought was to price at $1 or 2.
For me coming from a C/C++ background and having never done programming for a Mac, the iPhone seemed like a great place to start doing Obj-c and Cocoa. But if this has any truth to it, it might make me price any app I create >$10.
Before I even get that far, I'd like to know who Apple plans to handle trial period apps, free or discounted copy's that we may hand out and so on.
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MoonMan said 12:35PM on 6-27-2008
Apple didn't set up the App Store as a license for you or anyone else to print money. In my opinion they should be even tougher on qualifying software available through the App Store.
I would gladly pay a higher premium knowing that the applications I'm purchasing are not from some inexperienced indie developer.
Chris said 3:05PM on 6-27-2008
I just spent $1.50 on a cup of soda. If your application isn't worth at least 4 times ($6 for the math impaired) as much, I don't want it on my phone.
acidscan said 3:01PM on 6-27-2008
@MoonMan:
You really sound like you have no clue about coding, programming, etc, etc. Small applications, with small niches doesn't mean those are bad or low quality applications.
Fanatical attitudes, like yours, only contribute to overpriced software.
basscadet said 4:39AM on 6-28-2008
big companies not working in their momma's basement... like Microsoft?
SoyLocoMoco said 11:33AM on 6-27-2008
I think it sound like a fair deal. With millions of iPhone users out there, you should be able to sell at least a few hundred copies of your app. Anything that sells less than that is probably just clutter.
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KeynoteKen said 11:48AM on 6-27-2008
I agree. If an app that's selling for .99 can't sell to a couple hundred people (who are starved for software), then it can't have been that great of an app to start with.
If anything, I think this will have the effect of limiting how many poorly done "me too" apps we'll see.
Benoit Cerrina said 11:33AM on 6-27-2008
I don't see what is the fuss about it. I make an app for the iphone and made one for the palm. either you would expect to make a great deal more money than 250$ by charging for it or one should just make it available for free.
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Doug Adams said 11:35AM on 6-27-2008
I agree %100 with Dave Wood, above. If you don't anticipate your app making at least $250 then make it free.
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Hawkman said 11:37AM on 6-27-2008
My only real problem with this is that it's likely to artificially push up the price of apps. $100/monthly instalments (whichever is longer) might have seemed a little kinder - but then, if you can't find 360 people to buy your app for a measly $1, you probably wasted your time anyway....
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punkassjim said 12:32PM on 6-27-2008
I really hope you're wrong about this artificially pushing up the prices. Because, if that happens, it's completely due to a lack of experience in the indie software market. Ask Mike Lee or Craig Hockenberry if they're worried. The AppStore is gonna pay off that $250 within just a few days (if not just one day), as long as the developer is worth his salt. When it comes to setting initial pricing, the novices need to seek the counsel of the experienced, lest they screw up the whole effing thing.
totoro said 11:39AM on 6-27-2008
Seems reasonable to me. Given the overhead/transaction/etc. costs, Apple definitely had to set some level-no one really expected them to cut $0.69 checks every time someone bought your $0.99 app, did they?
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Lee said 11:42AM on 6-27-2008
I just want in the developer program already. I've spent a bunch of time on it already and am willing to forgo the $99 to make my app free.
Its a little ridiculous.
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Thomas said 11:43AM on 6-27-2008
I'm not a developer so I can't really comment because I'm not going to see any money. I would agree with the gist of other comments, if you're not expecting to make more than $250 within a reasonable period of time then you should probably make it free or not bother.
I suppose the hope will be that the store will be so visible to EVERY user of both the iPhone and iPod touch, that sales will be a lot higher (assuming the app is any good) than if they were just selling via their own sites. I suppose we'll have to see what happens and how successful the store is in general. If a developer has an app available on day 1 and gets a large payment shortly after then people's concerns may be abated.
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totoro said 11:46AM on 6-27-2008
There are much more serious issues/questions about the Apps Store though-Paul Kafasis of Rogue Amoeba goes thru them here:
http://blogs.oreilly.com/iphone/2008/06/open-questions-for-the-app-sto.html
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