Yeah sure free beats it. Most times. I mean sometimes people don't see the value when they are getting it for free. Example: Guy finds a bug in a free software and thinks 'what doesn't cost nothing can't be anything'. But these people are mostly end users not developers.

Long story short: I don't have a clue why Apple is selling XCode 4 BUT when I look at Microsoft you are getting a hell of a software for just 5 bucks. (Visual Studio costs 1500 bucks I think, to be fair there is also a Express (free) edition)

Anyway, I love the new XCode one window interface!

Even though $5 is pretty cheap. There is a lot of power in 'free' (As Dan Ariely would say), and I'm sure there will be some bad consequences for apple here, but not that many and maybe it's worth it for their new strategy for developers. What that strategy is, I have no clue.