Comment by mickrobk | Hacker News Reader

Comment by mickrobk | Hacker News Reader

I don't know - the underlying argument here, that developers need to avoid a race to the bottom isn't particularly new, new to Microsoft [0], or in my opinion convincing. This article seems like a strange mix of a Microsoft marketing piece, and a call for app developer collusion. In other industries it seems almost by definition that the worth of the product is what it's selling for -- .99 cents for most apps. Arguments along the lines of "surely apps are worth more because, c'mon look at the price of coffee," use only emotion based on how much work we see go into those as developers not the value provided to users. It's very easy to blame poor revenue as a marketplace problem rather than a product problem and it's this type of thinking that drives this conclusion rather than proper analysis.

A hit driven industry can be brutal but I'm not convinced that the app store is more of one than traditional software, social websites, marketplaces, and games all spring to mind as places where success is very hit driven. Even outside our industry: books, television, movies, music, fashion - these all all hit driven because that is what fits best with where the demand is.

* In the television industry most shows have both higher production costs and lower prices than software, does this mean this industry is broken?

* Increasingly for app store purchases with higher prices I hear about the apps from avenues other than the Apple featured list (ex drawing apps, higher priced games.) It seems that the marketing channel that is being provided for free is being mistaken for the only way to market.

Fundamentally as a developer if I want my app to sell for more money, I should make it bring more value to the customer, not hope for minimum pricing constraints on all apps. It's a great thing as a consumer that distribution and marketing channels like the app store have made it possible for me to use more software, and spend more money on software than I ever did on a pc.

[0] See minimum pricing of Xbox live games on both Xbox and Windows Phone

"This article seems like a strange mix of a Microsoft marketing piece, and a call for app developer collusion."

Author here; definitely not asking for collusion. More specifically, here is what I said:

"Look, you’re a developer – not a rodent in a maze. You should be able to recognize the pattern and the habit-forming behavior from a distance: if you bring iOS’s terrible economics to Windows 8, then Win8 will have similarly terrible economics.

Microsoft set the minimum price of an app in the Windows Store to $1.49 for a reason: to give developers a clean slate on app economics. You want a better opportunity than iOS? Then don’t ship iOS-utility (low-utility) apps with iOS prices on a platform that is purposefully engineered to do better!"

What I'm asking developers to do is: don't ship fart apps and other toys that pollute the iOS app store. Do what Router .CoCPit did and take advantage of WinRT's rich feature set (UPnP support in that particular instance) to deliver apps that are higher utility and thus worth more.

WinRT's native capabilities give developers access to a lot of things that could only be done through traditional desktop apps previously, and combines it with an App Store distribution model that has some new twists on pricing and monetization (expiring in-app purchases, for instance.)

I'm telling developers to take advantage of that and not blindly replicate what they did on iOS or Android.

WinRT will create opportunities for developers to build sustainable businesses off of higher utility, higher price,d and highly targeted applications - apps that are used by 10s of thousands, not millions.

The hit-driven mentality that pervades iOS need not apply here if we realize what we have in front of us.

Does that make more sense?

I think you don't understand individuals. We just want to eat - Individual developers really only care about making money.

If a fart app is going to make an individual developer good money, nothing you can say will stop them from being made.

If developers can seemingly make more money by charging less, nothing you can say will make them stop charging less.

Microsoft set a price floor to attract developers who aren't thinking about 1 year in the future, when Microsoft will either remove that floor because their platform is successful enough (they don't have to court developers), or they will kill the platform itself (and your app).

> Individual developers really only care about making money.

I think it is worse than this, (some) individual developers care about getting rich with one lucky, undeserved hit app. If they cared about a good average income, they would get a proper job as an iOS developer instead.

The bad news for Windows 8 is that this behavior will be at its peak right after opening the store. On the rather mature market of iOS, I haven't heard of overnight fart-app millionaires in a while.

I'm sorry, I certainly didn't mean to say you were actively asking for app developers to collude on price. Rather, that is the conclusion I drew following your arguments about app store issues. To be specific: (note some quotes are abbreviated, but I certainly do not intent to alter their meaning)

Your points about the app store being a race to the bottom

"There’s a tremendously negative pressure on prices … self-inflicted by developers..."

* "Microsoft set the minimum price… to give developers a clean slate on app economics"

I understand you when you say that higher quality apps are needed to get higher prices. What I am missing how higher quality apps in proportion to lower quality apps will happen. The proportion to lower value apps is that part that made me think price control (or curation, but to my knowledge the MS store won't be substantially different than Apple there.) I get the proportion part from your arguments that the app store is a race to the bottom, and has too many apps to make an impact.

I guess I disagree with your premise that the app store is broken, a race to the bottom, or that developers are having trouble making money there. All of the (anecdotal) evidence I've seen points to the opposite of that. I also don't see why the Win8 store would be any less hit driven than iOS, as I argued in the parent post.

I do agree with your articles position that higher quality apps are the key to higher prices, and I think your points about some of the scenarios win8 supports are very interesting. I'd love to read more about what I can do in Win8 versus iOS; that's just not the main point I got from your article (but may have been your intent :)

Fair enough - you're not the first person to draw that conclusion, so perhaps I should have been more explicit.

"I'd love to read more about what I can do in Win8 versus iOS; that's just not the main point I got from your article (but may have been your intent :)"

This is a great idea; we'll do that.

> Fundamentally as a developer if I want my app to sell for more money, I should make it bring more value to the customer, not hope for minimum pricing constraints on all apps.

Fundamentally, you are making a major category error. iPhones and iPhone apps are complementary products. You can't use an iPhone app without an iPhone and an iPhone is useless without apps (clue: Apple advertise the apps available for an iPhone - not the iPhone itself). Apple's marketing approach is to 'commoditise the complements' ie charge high prices for their side of the pairing whilst driving down prices on the app side. Market Theory (see Michael Porter's book Competitive Strategy - Techniques For Analyizing Industries And Competitors) indicates that pricing pressure between a company (Apple) and its suppliers (app developers) lies with the party that can most easily expand its operations into the others market. It is easy for Apple to write an app that duplicates your app - it is hard for you, as an app developer, to launch your own global smart phone. Therefore Apple has prices pressure against you (make you apps cheap, give me 30% of in-app purchases). The Windows team have less competitive price pressure to apply - therefore the price per app sold is higher than the Mac (but your volume is likely to be less).

Apple have (consciously) structured the market to capture the value for themselves - don't kid yourself otherwise. Anti-competitive legislation is designed to mop up this sort of behaviour - when it becomes extreme - I don't think Apple is in the monopoly position yet, personally, YMMV.

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