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IAP

The App Store made buying software something normal people do again — but almost as quickly, it’s seemingly turned into a marketplace of free apps paid for by in-app purchases. Marco Arment of Instapaper fame has argued that “Paid-up-front iOS apps had a great run, but it’s over”, while Joe Cieplinski, the developer behind Teleprompt+, argues that “there is a whole world of untapped potential on the App Store for developers who can solve real problems for people who are happy to pay.” I’ve always sided with the latter argument that paid apps will never die, but it only takes a few minutes of browsing the App Store to see that freemium apps have seriously encroached on the domains previously held by paid apps.

Are paid apps dead, or not — and is this just about iOS, or is it the same on the Mac? To answer that, we’ve talked with Nik Fletcher, product manager at Realmac Software, about their team’s experiences with app pricing and sales on both the iOS and Mac App Store. Realmac has recently faced backlash on the iOS App Store over Clear+’s pricing, but at the same time decided not to run discounts on their pro Mac apps, so they have a unique perspective on both markets.

To them, there’s a bright future for carefully considered in-app purchases and paid pro software. Here’s the interview:

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In-App Purchases have earned quite the bad reputation since they were first introduced to the App Store with iOS 3 in 2009. Their addition to the Mac App Store was met with dread and foreboding that it’d spell the end of quality paid apps in the wake of freemium apps filled with ridiculous in-app purchases. That hasn’t happened on the Mac yet, but on iOS, it seems like the traditional paid market is eroded more and more every day by free apps with in-app purchases.

The bad reputation is undeserved, though. I’m as critical of apps with in-app purchases as anyone could be — their very presence on free apps makes me skip the app by default unless it looks very impressive otherwise. But they don’t have to be bad.

Right now, the Mac App Store has escaped the worst of the race to the bottom in app pricing, in large part thanks to the fact that Mac developers can still distribute free trials to their apps on their own sites. It’s on the iPhone and iPad that in-app purchases have taken over, with a vengeance. Smartphone apps, perhaps, aren’t the best thing to compare to Mac apps, but iPad apps surely are fairly easily to compare, since many people today use iPads as laptop replacements. If in-app purchases are to be the future of app sales — especially on the Mac — they’d better be done right, and the best iPad apps with in-app purchases today are the best examples of how in-app purchases can be done well.

Paid apps aren’t dead, but in-app purchases are still going to be a big part of the app discussion going forward. Here’s what they need to make them work in a way that’s equal to or better than the traditional paid app market.

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