Apple’s business model relies largely on the App Store because of the fact that this is the sort of thing that could potentially end up giving the company a 30% cut of all revenues generated by the apps it features. However, one limiting factor that proved frustrating for certain developers was the minimum price of $0.99. Any app on the App Store had to cost at least this much, or alternatively it could be free to download and generate revenue entirely through ads.
With all of that having been said and now out of the way, it is important to note that Apple recently changed this rule. Developers could now set any price they liked, even if it was under a dollar. In spite of the fact that this is the case, it turns out that just 220 apps on the App Store have availed this opportunity. That accounts for a measly 0.28% of all apps, and even if we only factor in paid apps, it still comprises just 5% of the total.
This seems to suggest that there is not a lot of demand for such cheap apps. If the price is lower than a dollar, it might as well be cheap since this can lead to more downloads than might have been the case otherwise. Many are saying that the era of paid apps is over, which explains why there are so few apps that are priced at this low range.
However, countries like India are still using the lower price limit to their advantage. Indian consumers generally prefer to pay an up front charge while buying the app rather than paying for subscriptions, and the high rupee to dollar ratio means that even low dollar amounts can suffice.
All in all, it seems like in-app purchases are the name of the game. They can generate vastly more revenue than paid downloads, which explains why so many developers are opting for the hybrid model. The lack of third party tracking options further boosts the growth of in-app revenue, and that makes cheap paid apps even less attractive to developers and users alike.
H/T: Appfigures
Read next: Public Concern Grows as AI's Impact on Jobs Comes Under Scrutiny
With all of that having been said and now out of the way, it is important to note that Apple recently changed this rule. Developers could now set any price they liked, even if it was under a dollar. In spite of the fact that this is the case, it turns out that just 220 apps on the App Store have availed this opportunity. That accounts for a measly 0.28% of all apps, and even if we only factor in paid apps, it still comprises just 5% of the total.
This seems to suggest that there is not a lot of demand for such cheap apps. If the price is lower than a dollar, it might as well be cheap since this can lead to more downloads than might have been the case otherwise. Many are saying that the era of paid apps is over, which explains why there are so few apps that are priced at this low range.
However, countries like India are still using the lower price limit to their advantage. Indian consumers generally prefer to pay an up front charge while buying the app rather than paying for subscriptions, and the high rupee to dollar ratio means that even low dollar amounts can suffice.
All in all, it seems like in-app purchases are the name of the game. They can generate vastly more revenue than paid downloads, which explains why so many developers are opting for the hybrid model. The lack of third party tracking options further boosts the growth of in-app revenue, and that makes cheap paid apps even less attractive to developers and users alike.
Read next: Public Concern Grows as AI's Impact on Jobs Comes Under Scrutiny
