Wednesday, 24 July 2013

In app purchases and a developer's point of view.

Too many stories like this have popped up.

http://www.huffingtonpost.com/2013/07/23/3000-itunes-bill_n_3640842.html

In this story a family was charged 3000 dollar for in app purchases. If you don't know IAP are purchases that you make inside an app for more content. App developers usually give away their product for free and people buy what's inside the app.

Let me explore this and give you my point of view. First of all I really dislike IAP not only from a business point of view but from a consumer point of view. The biggest issue that encompasses this entire debate is the relationship between the customer and paying money in the app store. Customers on the app store have a toxic view of money especially money upfront. If I charge 2 dollars for an app upfront people tend to hate that. Whereas if I give the app away for free, have ads in it and then charge two dollars then all of a sudden people are happy.

I have never seen so much hate for so few dollars. Keep in mind that people pay way more money for stuff that doesn't work. If we fix this problem then a lot of this issue will go away. The reason is that if you want to make a game you pretty much have to give it away for free, that is if you want to make money. This model is called freemium and I dislike it as well. What really needs to happen is that parents need to know about this business model and know that it usually costs more. Remember there is no such thing as free.

On top of this if you go the free route then there will be ads in the app. These ads will not be regulated so it's possible an 8 year old will see an e-harmony app or something similar to that effect. There are no regulations around mobile ads so if you are a parent and are concerned about that what do you do? Simply you pay the 2-10 dollars for the game upfront. This way there will be no ads and there will be no IAP.

I personally like this approach the best. It's the same business model we have for virtually everything else in the world, why shouldn't it be fore the app store as well? The freemium model can easily be abused by the wrong people. Imagine if somebody just gave you a free coffee on the street. Would you be suspicious? Use the same caution with software.

I should point out that there is a difference between freemium and samples. Everybody has free samples or demos but the demo usually expires. Freemium never expires.

The best thing parents and developers can do is just pay the money up front. It makes more sense and you won't get anything you didn't bargain for. There are free games as well but they are usually ad supported. If you are a parent I will leave the choice up to you. I make sure all of my apps have not IAP and that you can just download the app for a few dollars. It does hurt sales a bit but I feel that it's the best choice in the long run.

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