Gold Rush 2.0

By Rob Fahey Published 24 April, 2010

Promises of a new wave of profit for iPad developers ignore the destructive downward pressure on iPhone game prices.

GamesIndustry.biz, the trade arm of the Eurogamer Network, recently completed the next step in its evolution toward greater support for the videogames business with the implementation of a full registration system.

As the overseas launch of the iPad approaches, and the United States prepares for the arrival of the 3G models of the tablet system - which are likely to bring with them a significant surge in demand, if the pre-order figures being bandied about are realistic - many developers will be casting their minds back to statements made during the gadget's much-hyped launch. In particular, some will recall the promise of a "second gold rush" - a new wave of success for app and game developers, comparable to the heady early days of the iPhone and iPod Touch.

The concept of a gold rush brings to mind the unbridled optimism of realising that there are untapped veins of profit waiting for the right people to come along and exploit them - open pastures as yet untouched by the big corporations who dominate other sectors of the market, ready for small, enthusiastic and innovative people to move in and make their mark.

Students of history, however, will point out that real gold rushes also tended to have much darker consequences. Battles between rival prospectors and a wanton disregard for the environment meant that the human and ecological costs of gold rushes could be immense, leaving behind a barren, scorched landscape and dusty, desperate towns filled with those who couldn't afford to escape to greener pastures. There's a good reason why many of the most bleak Westerns are set in the aftermath of a gold rush.

In other words, it's worth taking a closer look at where the iPhone gold rush has left the market before we all get too excited about the prospect of doing it all over again on the iPad.

There's no question but that the iPhone has been an immense success as a gaming platform. Software revenues on the device have overtaken the PSP in the United States, according to some measurements - and even if other metrics are more dubious on this claim, the fact that a platform where games almost all cost less than $5 is even in the same ballpark as one where the games cost $25 or more is astonishing.

Moreover, it's undeniable that much of that success has fallen into the laps of small, plucky developers rather than the established publishers. Larger publishers have certainly had hits on the iPhone, but most of the platform's runaway successes have come from newcomers or independent developers.

Their success is enabled by Apple's largely agnostic approach to publishers, with the firm much more willing than other platform holders to promote worthy indie efforts over the heads of less appealing titles from industry behemoths, and is amplified by the low overheads of small studios, who can therefore enjoy far more of their success as profit.

Not all of the promised land's rivers, however, run filled with milk and honey. Huge problems have emerged in the iPhone game market - problems which the iPad risks repeating, or simply carrying over.

The most obvious problem is pricing. From a consumer perspective, the iPhone offers extraordinary value, with many great games selling for under $2 - and some good titles going for under $1, or even for free. This is the result of intense competition on the platform, which has pushed prices down closer and closer to the App Store's lower limit (79 cents, or 59 pence) as the device's lifespan has extended.

What started out as price points for simple, cheap games have gradually become ingrained in consumers' minds as being the price point everything should aim for - and more expensive software has to work very hard indeed to justify its pricing.

Of course, if a game creator can sell something for $1 and make a profit from it, then he is perfectly entitled to do so - that is the market at work. Game publishers may be unable to compete with that, since they have much larger overheads and costs, but the beauty of an open market is that it allows small, nimble companies with low costs and good ideas to undercut lumbering, inefficient rivals.

The problem is that, in conversation with iPhone game developers, it seems increasingly obvious that many of them cannot sell their titles at $1 and make a profit from them - but feel forced to opt for lower price points in order to win the consideration of consumers in the first place.

They are playing a risky gamble, hoping that by establishing the game as a success they will create an opportunity for profit down the line. In doing so, they give the vicious circle another hefty push, ensuring that other developers, too, cannot break out of this destructive cycle.

Just as gold prospectors scorched the earth behind them, so too have developers on the App Store critically damaged the ecosystem in which they operate. The extent to which prices on the App Store have collapsed are not the result of a healthy market - they're the consequence of a perversion of the dynamics of the market by developers willing to sell at a loss in order to make a land grab, forcing others to follow in their footsteps and keep the downward pressure mounting.

The consequences of this problem will reach out and touch the iPad, too. Already developers attempting to launch products at higher price points on the iPad are being hammered in reviews for "profiteering" - a dirty word in some quarters, perhaps, but hardly unreasonable if you're one of the iPhone developers who's been sucking down losses on your games for the past year.

Two solutions present themselves. The first is for Apple to enforce more tight price controls on the App Store, raising the lower boundary for games to bring an end to this destructive cycle.

That, however, won't happen - and nor should it. Quite laudably, Apple views itself as being beholden to one group of people only, namely those who buy its hardware. With no significant vested interest in the software end of things, it's not particularly concerned about pricing, and would prefer developers to work things out among themselves.

The second solution, then, is the one that must come to pass - and that's the abandoning of up-front pricing for games entirely. If it's not possible to sell App Store titles for 79 cents each and make a profit, then companies must turn to other solutions.

In-app purchasing and advertising are the two obvious candidates, along with a version of the old shareware model from the heyday of the PC platform - but there may well be other business models out there as well. In particular, the launch of Apple's own iAd network - a shot across Google's bows if ever we've seen one - should make game developers sit up and take notice.

For years, commentators have argued that "freemium" models such as these could be useful additions to existing business practices. On the iPhone at least, events have overtaken such ideas. An understanding of freemium on this platform isn't just a nice-to-have - as developers plough salt into the ruins of the pricing tiers on the App Store, freemium may well be the only way for good games to capitalise on one of the world's fastest growing gaming platforms.

For more views on the industry and to keep up to date with news relevant to the games business, read our sister website GamesIndustry.biz, where you can read this weekly editorial column as soon as it is posted.

Picture of Rob.

About Rob Fahey

Rob Fahey is a former editor of GamesIndustry.biz who spent several years living in Japan and probably still has a mint condition Dreamcast Samba de Amigo set.

Read more articles from Rob by visiting the Rob Fahey archive page.

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Comments (55) Latest comment 2 years ago

Comments for this article are now closed, but please feel free to continue chatting on the forum!

  • GreyBeard #1 2 years ago

    Time for a do-over.
    Android.

  • paul_haine #2 2 years ago

    It depresses me when I see people complaining about 'high' prices on the App store, when that 'high' price turns out to be less than £3. Look at all the moaning here on Eurogamer whenever the Eurogamer app is mentioned for instance. People are dicks.

    I know that doesn't solve the problem, I'm just having a moan.

  • DaemonSpawn #3 2 years ago

    That's why we won't see on iPhone something like PSP's God Of War - CoO, Burnout Dominator or GTA - VCS, Wipeout Pulse or even LittleBigPlanet, at least as exclusives. Nobody's gonna develop so expensive games knowing they can't be sold for more than $10.
    Visuals may be good in some iPhone games, but lack of quality content and overall polish scares me off. It's all like PC's casual shareware of early 2000s.

    PSP is long since dead but iPhone/iPod Touch has never even been alive from that pespective of "big" core games.
    Edited by DaemonSpawn at 24/04/10 @ 08:15

  • Rack #4 2 years ago

    Err, there already ARE titles like Burnout Dominator and Little Big Planet on the iPhone, so that's a bit of a redundant argument. Major licensed titles don't do so bad, they tend to be priced at about £6 which leaves a profit for the publishers broadly in the spectrum of a big box release title. It's the no-name software that struggles to differentiate itself. More to the point though as the first truly portable games console it's in the position that small, polished fun for 5 minute titles do the best and it's hard to command a decent price for such things in the absence of a review body that can hope to keep pace with it. Without such a process it's very difficult for a title to differentiate itself which causes some of the problems described here.

  • Dizzy #5 2 years ago

    The new gold rush will be windows series 7 in September. Small marketplace, xna and big sales are an explosive combo. Most of the mobile devs I know are porting to ws7 now.

  • DaemonSpawn #6 2 years ago

    2 Rack
    there already ARE titles like Burnout Dominator and Little Big Planet on the iPhone
    Look at the "lack of polish" and "not enough content" parts. Number of tracks, cars, licensed songs - nothing comparable AND exclusive. NFS for instance isn't such title, because most of the content is re-used across multiple platforms, so development budget isn't as big as in Gran Turismo mobile.

    And please, give a link to iPhone's LBB-alike. But only link if it has great editor, online community, tons of spectacular levels with many different props, lots of music tracks and polish, polish, polish (not as in Poland).

    Perhaps I'm the minority with hunger for cool "proper" games (no matter which genre) which I can play in transport for couple of hours a day, but I want such games to be big enough (not just couple of levels, 2-3 cars or same number of units), to have decent story, some complexity (not difficulty, but complexity - different strategies and tactics to achoeve victory etc) and be well tested and polished, so I won't have a feeling it's just another game for mobile. Attention! By "big" I don't mean "same as on consoles"! Handheld games should be suitable for on-the-go gaming, of course.
    And I'm ready to pay for it 25-50 dollars depending on genre and title.

    PSP had its share of such games, DS had them too, but what about iPhone? First-party titles would help, but I won't count on this fantasy and will wait for Nintendo 3DS instead.
    Edited by DaemonSpawn at 24/04/10 @ 09:22

  • AOFanboi #7 2 years ago

    Android? A platform where I as a Norwegian still cannot sell my apps for money through the Marketplace, a platform where only a fraction of users have upgraded to the latest fancy OS releases because phone companies drag their feet in releasing locked-down distributions, and where the form factors to consider and device speeds vary far more than in the case of the iPhone? No thank you.
    Edited by AOFanboi at 24/04/10 @ 09:43

  • Rev.StuartCampbell #8 2 years ago

    "Just as gold prospectors scorched the earth behind them, so too have developers on the App Store critically damaged the ecosystem in which they operate."

    That's a rather odd assertion to make after pointing out what an absolutely enormous success the App Store has been and still is.

    It's hilarious to watch people from the mainstream games industry panicking about App Store pricing and constantly demanding things get more expensive. The App Store works incredibly well the way it is, having generated a market worth BILLIONS out of absolutely nothing in the space of barely a year.

    More expensive, "big" games CAN do very well, if for some reason that's what you bought an iPhone to play. The current top-grossing apps - that is, the ones making the most money - include plenty of games selling at "premium" prices. The no.1 grossing app right now is Football Manager 2010, at what on iPhone is an eye-wateringly high £6.99, and there are only three 59p games in the top 30.

    What that very clearly shows is that you can be a big success and make loads of money whether you sell cheaply or expensively. The App Store is not broken, despite endless assertions from the mainstream industry that it is. The industry is terrified. Enjoy it.

  • Rev.StuartCampbell #9 2 years ago

    "Perhaps I'm the minority with hunger for cool "proper" games (no matter which genre) which I can play in transport for couple of hours a day,"

    Well, no. The minority you're in is "people who want that but who have somehow stupidly failed to buy a PSP, which hosts countless scores of exactly the sort of tedious, overblown bloatware that they appear to enjoy".

    Your tastes are catered for by the PSP. Please buy one and stop trying to ruin the iPhone for those of us who love it the way it is.

    Oh, and PS:

    "so development budget isn't as big as in Gran Turismo mobile... Perhaps I'm the minority with hunger for cool "proper" games (no matter which genre) which I can play in transport for couple of hours a day, but I want such games to be big enough (not just couple of levels, 2-3 cars"

    You're aware that Real Racing on iPhone has MORE opposition cars onscreen than the pathetic 3 that Gran Turismo PSP (with its huge budget, more powerful hardware and years of development) manages, yes..?
    Edited by Rev.StuartCampbell at 24/04/10 @ 09:55

  • KDR_11k #10 2 years ago

    To be fair most of the games sold on the app store truly aren't worth more than 1 dollar/equivalents.

  • makeamazing #11 2 years ago

    I think this article is spot on... I've met a number of iphone developers over the last 12 months and they have invested alot of time and money into making a good game, unfortunately as Rob has suggested, the downward pressure (from both competitors and consumers) on the prices means they have to sell their game alot cheaper than its actually worth. None of the people i had met had made their money back on their games, while they did know of developers who had made money.

    My biggest cost is the hardware/dev software (middleware), I am trying to keep the actual development (graphics and programming) costs low as I also agree with other comments - release nice looking simple games/apps and keep em cheap. That way you should be able to rise above the rubbish that is out there.

    Oh someone mentioned Android, its a growing platform, but apparently users can also "Return" a game, whereby you then have to pay their money back, so it doesnt stop people from playing the game, getting bored and then saying they dont want it anymore. Something like that is bad for developers and even the 59p model.

  • Segnit #12 2 years ago

    Thanks for my Saturday fix, Rob and EG!

    Anyhow, I don't think it makes sense for publishers to to take a monetary hit on the ipad appstore this early because I think that the appstore consumer may very well be oblivious towards a publisher's name. Most of the time the software on the appstore is so cheap and disposable that it's hard to imagine a scenario where the publishers efforts to bring longevity and quality to the market would be appreciated.

  • playgen #13 2 years ago

    So some developers make lots of money from their games, and other developers don't. This is nothing new, its exactly what happends with game releases on all proper consoles and handhelds too. Sorry but if you release a bland or crap game, then its your fault, not the store or the consumer. There seems to be this idea (shown a lot on this sites comments for one) that game developers, unlike any other workers in the world, deserve a good living from their job not matter how good they are at it.

    Big companies want to use digital distribution to increase profits, while passing on no savings to the customer. So its no surprise there are going to be a lot of complaints over a store where prices are broadly low.
    Edited by playgen at 24/04/10 @ 11:07

  • paulf #14 2 years ago

    my friend told me a great story about a 'gold rush' - his family made a fortune in the original goldrush in America, not by panning for gold but by selling food to the folks that were

  • Rev.StuartCampbell #15 2 years ago

    "Most of the time the software on the appstore is so cheap and disposable that it's hard to imagine a scenario where the publishers efforts to bring longevity and quality to the market would be appreciated"

    Except, of course, for the scenario that ALREADY EXISTS, where most of the top-grossing apps are "quality" titles sold at premium prices. As for "longevity", one of the 59p titles in the top-grossing list (Doodle Jump) has been there for the entire duration of the chart's existence, and the other two highest-placed 59p titles (Angry Birds and Paper Bridge, both very well-made games) have been in the top-grossing top 30 for their entire existence.

    You've got to love how idiots can so confidently assert things which are the exact opposite of the factual reality.

  • Rev.StuartCampbell #16 2 years ago

    "the downward pressure (from both competitors and consumers) on the prices means they have to sell their game alot cheaper than its actually worth"

    No they haven't. They might have had to sell it for less than THEY THINK it's worth, but the market didn't agree or it would have paid the higher price. Once again, unfortunately the factual reality contradicts what you *wish* was true.

    90% of the top-grossing games ARE NOT sold at the minimum paid price point. If people think your game is worth more than 59p, they WILL pay more for it. If they don't, it's you that failed, not the system.

  • Jackface #17 2 years ago

    The App Store's lowest price is 99 cents, not 79 cents. Just a heads-up :)

  • Jackface #18 2 years ago

    Daemon Spawn, have you not seen the App Store version of Grand Theft Auto Chinatown? It's exactly the same game as the DS and PSP, with a couple of small graphical changes. Goes for £6 on the App Store, versus at least £10 or even more for the DS or PSP version. Great price, had no problem paying that.

    Of course there's the fact that the iPhone simply should NOT host versions of console games, mainly because the touch-screen doesn't lend itself well to ports of games that are meant to be controlled with a controller.

    But there are plenty of other great original touch-driven games that are huuuge and well worth more than they're going for.
    Edited by Jackface at 24/04/10 @ 11:47

  • Jackface #19 2 years ago

    @Stuart Campbell: yeah there's some developers doing great with high priced apps and some developers doing great witg 59p apps. However, to make money with a 59p app you really have got to get lucky and sell hundreds of thousands of copies. I'm always really please to see Angry Birds and Doodle Jump doing well but you have to admit they're the lucky few.

    From a 59p sale the developer is going to get about 30p tops once Apple takes their 30% and you pay taxes on the rest. There isn't nearly as much pressure on the people selling for more money, so long as their product appeals to the market enough to make them overlook the price being more than a quid.

    I think the vast majority of games on the iPhone probably don't deserve to be much more than 59p given how flimsy there are, but something like Angry Birds could so easily be £1.79 and still be incredible value, especially given how many significant content updates it's had and existing users have never had to pay for those.

    But, that downward pressure has contributed to the 59p price point. I think it's a shame that some developers are most definitely not getting the profits they deserve because they've priced low to get noticed.
    Edited by Jackface at 24/04/10 @ 11:51

  • Rev.StuartCampbell #20 2 years ago

    Just for fun, here are the actual FACTS behind the claims that you can't do well on the App Store unless you sell at 59p.

    PAID TOP 100 (all prices)

    59p: 59
    £1.19-£2.39: 19
    £2.99+: 22 (of which £3.49+: 11)

    Highest price in top 10: FM2010 (£6.99)
    Highest price in top 100: NDrive (£9.99)

    In other words, a little over half the top 100 is made up of apps selling at the lowest price. 41% of Top 100 apps made it in there despite being more expensive than the minimum. Perhaps more interesting, though, is the top-grossing chart, showing what actually made the most money.


    TOP-GROSSING TOP 100

    Free: 3
    59p: 21
    £1.19-£2.39: 17
    £2.99-£7.49: 39
    £7.99+: 20

    Highest price in top 100: £99.99 (TomTom Europe, no.38)
    Highest priced game: £7.49 (Chaos Rings, no.14)

    So what does this tell us? It tells us that:

    1. More expensive games (the £1.19 to £2.39 bracket) do almost exactly as well in the top-grossing chart as they do in the top-selling chart, despite having to compete with the high sales of 59p apps and the high margins of the super-pricey apps.

    2. You can make loads of money out of 59p apps. 21% of the places in the top 100 grossing chart is an incredible figure when you consider you're competing with apps that make almost 200 times as much money as you do from a single sale. It's certainly far from a "lucky few". It's a lucky quite a lot.

    3. You can ALSO make lots of money out of selling games at higher prices, like Football Manager (£6.99), Street Fighter IV (£5.99) and Chaos Rings (£7.49).

    In other words, pricing is a CHOICE. Developers and publishers can CHOOSE what price to sell at, and the market will decide what a game is worth. If they think your game is worth 59p and you charge 59p for it, you'll make loads of money. If they decide your game is worth £6 or £7 and you charge that price, you'll also make loads of money. The only way you WON'T make money is if your game is shit or if you're charging more for it than people think it's worth.

    Low prices are NOT "destructive". The facts couldn't be any clearer if someone burned them into your retinas with a laser. Good games at low prices make money. Good games at high prices make money. Conclusion: stop fucking whining and make some good games.

  • Mr.Monkey #21 2 years ago

    My biggest concern is the anti-flash stance that apple has took. Before you could at least recompile your flash based code, now the new SDK has even blocked that. Making it more difficult for some aspiring developers to easily produce apps.
    Edited by Mr.Monkey at 24/04/10 @ 11:59

  • Jackface #22 2 years ago

    Just a general comment to justify the low prices overall, even though I think they could be higher: the prominence of the App Store on the iPhone, iPod touch and iPad, the incredibly low overheads for software devs compared to bricks-and-mortar or even something like Xbox Live Arcade, the fact that it's the ONLY way to sell software legitimately for those devices, and also the rapidly increasing userbase, all means that if anything the market for these apps can be priced a bit lower overall than other markets because more apps are being bought per device, more frequently, than any other device on the market.

    Of course that level of commerce is also being driven by the low prices of apps so it's a vicious circle...

    ;)

  • BOFH_UK #23 2 years ago

    Thing is we're already seeing this change as devs try out different revenue models. People seem to forget this is an emerging market and there isn't really a clear path for developers to take in order to maximise their profits just yet. As the article mentions there's iAd's coming in the next few months (and certainly a lot of advertising already takes place) and a big push towards the old shareware model where the game is free along with the first couple of levels then you pay to unlock more if you like it. Hell, talk about a perfect platform for episodic gaming, everything's in place to deliver that content at reasonable prices.

    I do kinda get the impression though that a lot of people are complaining because they thought this was going to be easy money. Sorry folks but there's always a risk when you create a product that it might not succeed in the market. Worst part is it might have nothing to do with you or the quality of your product and be totally out of your hands but, hey, such is life I'm afraid.

    There's another tool coming that hasn't been mentioned yet as far as I can see: Apple's new Game Centre. That might sound stupid, it's a community not a sales platform after all, but think about it. Your friends list is going to be full of people you (hopefully) know and will show you exactly what they're playing. That presents another opportunity for app developers to get their product in front of consumers, this time with a built-in recommendation from someone that you trust (if they're playing it and haven't told you to run screaming it's gotta be at least okay... right?).

    Basically, app stores are going to change significantly over the next few years. There's going to be three big players and they're all going to be trying different things. App developers are going to need to not only create good products but also be smart about how they promote them and adapting to different business models as necessary. Exciting times for everyone I'd say and it's going to be interesting to see how this feeds back into the more traditional console market.

  • Jackface #24 2 years ago

    Stuart I know you like to be right all the time and won't ever concede even an inch on anything you comment on, but I feel like some of the 'facts' you're using to prove you're right could be a little more objectively explained.

    Even though I'm sort of in agreement with you that some 59p apps (some. a very, very small percentage) are doing really really well, you don't actually know how much money they've spent on development and therefore how much money they are making in terms of profit. Those charts also don't tell you how long an app has been on sale to earn the money that's placed it in the Top Grossing chart, and furthermore being in the Top 25 or whatever is also no indication whatsoever of financial success, just popularity.

    Bit of history for those who don't follow it all that cloesly: the Top Grossing chart, incidentally, was introduced because it's a slightly more objective view of what apps are doing well than the Top 25-100 chart, which can be heavily skewed by the low price of apps. It's quite hard to navigate through the App Store on the iPhone, something developers have long been annoyed about, and the Top 25 would often be the first port of call for a customer, where the most popular apps at the moment are showcased. However with the prices being so low, many very deserving apps weren't getting into the chart because, well, they weren't cheap enough. The chart was less a gauge of what's doing well as it was of what was new that week and what was cheap, so Apple introduced the Top Grossing to offer another view of the Store that wasn't so skewed to 59p and Free apps.

    Anyway, Rev, I'm not arguing with you on principal really, I agree there are lots of really great 59p apps, and some really successful 59p developers, but I do think there's an argument that it's not an ideal situation.
    Edited by Jackface at 24/04/10 @ 12:04

  • Dizzy #25 2 years ago

    >My biggest cost is the hardware/dev software

    Why?

    I am doing iPhone development on a virtual Mac... no real hardware.

  • Jackface #26 2 years ago

    @Mr.Monkey: Apple wants people to use the proper coding language to write for their device and they see converted Flash apps as being less than ideal. They also want to stick it to Adobe of course but I think getting apps that are coded correctly is higher on their list and I don't think there's anything wrong with that.

  • Rev.StuartCampbell #27 2 years ago

    "Anyway, Rev, I'm not arguing with you on principal really, I agree there are lots of really great 59p apps, and some really successful 59p developers, but I do think there's an argument that it's not an ideal situation."

    If correctly-priced apps that people like, be they cheap or expensive, being the ones that make the most money isn't the ideal situation, I'd be intrigued to hear what would.

  • Windypops #28 2 years ago

    Brilliant article.

    The App Store should set a minimum price of £20. That way, it can ensure that all developers get speedboats. Apple never considered the knock-on effect on the speedboat industry when they recklessly allowed market forces to dictate prices. There are speedboat manufacturers out there giving blowjobs in public toilets for a fiver a time. I've spoken with a few and they're well peeved.

    It's especially brilliant that a website, which exists primarily as a consumer's guide, is brave enough to publish an article asking that the consumer continue to be ripped off, as they have been for years. Go Eurogamer!

  • paulf #29 2 years ago

    I have a couple of apps on the appstore - they don't make a huge amount of money but the interesting thing is since I made them ad supported I make as much as when I charged for them, and it is easier to get the proceeds off admob (google) than it is to get them off apple

  • Rev.StuartCampbell #30 2 years ago

    Windypops FTW.

  • makeamazing #31 2 years ago

    @dizzy - to be honest i had never heard of virtual Mac until you mentioned it ;). But i purchased a Mac, and cannot program in Xcode so had to buy a middleware product. So perhaps that is an expensive mistake (well only if i never make enough to pay for the equipment that is :) But to be honest, except for all the issues and hassles making games for the platform, I am having fun doing it and its not about just making money (which many people who jumped on the platform that is their no1 priority). But its still cheaper and easier/faster to make a game/App as an indi on the iphone than it is on the PC, which is what i was originally trying to do. I dont find long projects as an indi that exciting to be honest, because anyone who you pay to help can get bored pretty quickly.

    With regards to apps and prices, to be honest its not as easy to categorise this price is best, etc etc. Its great that you have made a breakdown on the top 100 Rev, but there are something like 100 games released a day, so to get a proper feel for it, you would need to know what proportion of games are actually released at 0.59p and above and what development time and cost. From my experiences of talking to people who make games for the platform, for smaller games (that may well be worth more than 0.59p) there is pressure to price it at lower prices. BUT also people have released games at the next tier up and then have reduced the price to 0.59p and its not generated any additional sales. The main problem as i see it is that there are too many people making games for the platform, which just clouds the waters and makes it harder to find the better apps.

  • lucky_jim #32 2 years ago

    I know what I'm about to say is totally anecdotal, but I quite happily paid £7 for FM Handheld and £7.50 for Chaos Rings. I would never, ever have paid £30+ for either: handheld games just aren't worth that much to me. I don't have any figures to back this up, but both seem to be doing pretty well, despite their "premium" price points. Both feature in the top 20 grossing list, with FM at number 1.

    The article's quite right when it points out that a lot of people whine about stuff being priced above a quid or two, but people used to whine about Ultimate charging more than their competitors for Spectrum games. The fact people prefer not to pay for stuff is nothing new, nor is the fact that they'll pay for it anyway if the price is reasonable and the quality is good enough.

  • secombe #33 2 years ago

    Yes but the Eurogamer app is (a lot of) money for old rope.

    True to a point, sure £2.99 isn't a lot of money in the grand scheme of things, but in comparison to other apps it's got to be doing something fairly special to command that sort of price. The EG App sadly doesn't, it's essentially a slightly easier way of viewing EG, but with lots of bits missing (such as Groups).

    The same complaint can be fired at Empire (the movie mag), a truly appalling app with virtually no support or updates, yet they are trying to push it at a 'premium' price point.

    The Guardian nailed 'website in an app' first time, and sold an incredible numbers as a result, despite the relatively high price.

  • arcam #34 2 years ago

    Rev. Stuart Campbell should have written this article.
    Edited by arcam at 24/04/10 @ 20:45

  • Subquest #35 2 years ago

    ....TOP-GROSSING TOP 100

    Free: 3    ....

    You have to question stats that feature free games in the top grossing figures, surely?

  • Auspex #36 2 years ago

    @Subquest. I think you can make your game free but with ads so that might be why free games still make money.

  • Segnit #37 2 years ago

    I retract what I said earlier. I was shown to be wrong.

  • Scoops #38 2 years ago

    Well Windypops, you made me laugh, cheers!

  • jonbwfc #39 2 years ago

    @makeamazing "But i purchased a Mac, and cannot program in Xcode so had to buy a middleware product."
    A book on iPhone Programming would have been considerably cheaper. No disrespect but if you can't actually figure out how to write useful code, I'm not sure I want to be paying for your app regardless of what method is used to develop it.

  • AOFanboi #40 2 years ago

    @Jackface: The "79 cents" probably refers to € 0.79 while your 99 cents refers to US$ 0.99

  • Rev.StuartCampbell #41 2 years ago

    "You have to question stats that feature free games in the top grossing figures, surely? "

    The games in question make their money from in-app purchases, which Apple includes in the top-grossing figures.

  • makeamazing #42 2 years ago

    A book on iPhone Programming would have been considerably cheaper. No disrespect but if you can't actually figure out how to write useful code, I'm not sure I want to be paying for your app regardless of what method is used to develop it

    Well i never said i was actually writing the code for the game, ;) Theres nothing wrong with using middleware, and its easier for me to understand what program code has been written rather than needing to learn objective C just to figure out what is going on, on screen. Seriously if you see game A and game B written by two different methods and they both work as expected, why on earth would you have issues with it? Its not like you can suddenly open up the game and go, oh my he shouldn't have used the code in that way... as long as it runs as people would expect it, then whats the issue?

    Unless you are one of these programming elite (please don't get me started on that subject matter...lol) who has issues with us poor saps who use different methods to get our games/designs into users hands?

  • humanchu #43 2 years ago

    Writing this from my new iPad (in San Francisco, sadly just visiting).

    Having played with the device the last few days I think that it offers a gaming experience that is above that of an iPhone (and probaly DS and PSP too). It's grea (basically because the screen is bigger). And I think this will be enough to motivate a higher price point for any game (even if it's a HD version of an existing iPhone title).

    But that will not change the fact that the Appstore customers are of a different demographic than GAME customers. GAME customers are gamers, willing to pay up to $60 for a big game experience. In the Appstore you get some gamers too but mostly just regular people looking for a quick casual entertainment fix, which is worth about 99 cents.

    So until you get more gamers in the Appstore or educate casual gamers that a game experience could be worth much more, game are likely remain basic and prices are likely too remain low.

    The recent clip of Quake3 running on an iPad (or if Blizzard did something on the iPad) could be a step in the direction of changing that.

  • Xinch #44 2 years ago

    "profiteering" - a dirty word in some quarters, perhaps, but hardly unreasonable (your point here Rob being, "reasonable" not unreasonable?)

    Someone said this is a brilliant article. I disagree. I don't see how it adds anything except regurgitation and then speculation. Not the usual quality from Mr. Fahey in my opinion.

  • Rev.StuartCampbell #45 2 years ago

    "profiteering" IS a dirty word, of course. "profit" isn't, but profiteering specifically means making EXCESSIVE profits by charging ripoff prices for stuff. (Usually black market things that are in short supply, which pretty much rules out the contents of the App Store.)

    But journalists don't have dictionaries these days, which is why we have the word "addicting"...

  • jonbwfc #46 2 years ago

    Unless you are one of these programming elite (please don't get me started on that subject matter...lol) who has issues with us poor saps who use different methods to get our games/designs into users hands?
    I have no particular problem with people who can't program. I have a problem with people who can't program who think stitching a bit of middleware together into something adequate means they should be paid as much as people who have taken the time and effort to do the job themselves. It's a simple case of proportionate reward for labour, there's no snobbery to it. If anything it's a slightly socialist attitude.

    I have no objection to people using different development tools (although that's kind of moot because Apple obviously do) however I honestly think that the quality of a product is related to the amount of time, effort and care you put into it, by whatever means. If you don't feel like putting that much effort into your product (such as the time and effort to learn how the platform works to get the best out of it) I honestly don't feel like paying you that much money for it.

    If you have great game ideas, be a game designer and find a coder to code the thing for you. I'm absolutely certain there are loads of coders on the internet who would happily collaborate for an equal chance to earn some cash and build a portfolio. Being a coder who has a published iPhone game even if it was designed by someone else, especially if it makes money, is something that's in pretty high demand right now. Equally nobody in the world of 'big gaming' expects games designers to be coders; they expect coders to code and designer to design.

    But hey, feel free to pay for middleware that allows you to produce a product that's, you know, good enough. It's not as if there's any competition on the app store, after all.

  • makeamazing #47 2 years ago

    Errr Jon you obviously didn't take any notice of my last post....I never said i was doing the programming, but that doesn't mean i shouldn't try and learn as much about the platform as i can. You do know there is some top quality middleware such as Unity and iTGB. used by companies such as EA etc.. you really need to stop being such an Elitist.

    If you don't feel like putting that much effort into your product (such as the time and effort to learn how the platform works to get the best out of it) I honestly don't feel like paying you that much money for it.

    With that attitude i don't particularly feel like taking much attention to your opinion ;)

  • trousers #48 2 years ago

    Someone said this is a brilliant article. I disagree. I don't see how it adds anything except regurgitation and then speculation. Not the usual quality from Mr. Fahey in my opinion.

    You did read the rest of the post that started "Brilliant Article" right?

  • superdelphinus #49 2 years ago

    i think the recent success of Football Manager 2010 on the iphone shows that people will readily pay (relatively) high prices if the game is good enough

  • jonbwfc #50 2 years ago

    "With that attitude i don't particularly feel like taking much attention to your opinion ;)"
    Yeah, because ignoring the customer's opinion is always a great idea in a commercial market.
    Edited by jonbwfc at 26/04/10 @ 09:21

  • Les #51 2 years ago

    "Two solutions present themselves. The first is for Apple to enforce more tight price controls on the App Store, raising the lower boundary for games to bring an end to this destructive cycle."

    There's a third solution: developers/publishers that can't make a profit at the $1 price point or can't convince consumers that their games are worth more will disappear, to be replaced by those that can. iPhone/App Store introduced a new model and it takes some time for the economics of such a model to mature and stabilize.

    But I think the most likely outcome will be a "freemium" model as the value of 'software' has never really gelled well with human psychology. Most people are willing to spend on software only if it's tied to hardware. Except for niche groups like gamers, consumers generally spend little money on direct software purchases. The big software vendors pretty much make their money by selling to businesses (SAP, Microsoft, Oracle) - so to people that spend a budget rather than their own money - or through tying their software to hardware sales (MS's OS monopoly).

  • IP #52 2 years ago

    BOFH_UK nails it, in case people missed it: "I do kinda get the impression though that a lot of people are complaining because they thought this was going to be easy money."

    As someone who writes for the Mac and iPod press for half of my life, the above is the gist I get. People write a game, and they expect money to come rolling in, despite the fact the game's not great and they've barely bothered marketing it.

    Oh, and Windypops and RevStu +1. In fact, + 1 billion (each).

  • makeamazing #53 2 years ago

    @jonbwfc, You are not my customer though, and i dont want you as one, because you obviously have a very big chip on your shoulder... go and see about getting it removed.

  • jonbwfc #54 2 years ago

    "You are not my customer though, and i dont want you as one"
    Just look at the app store kid, it's a bear pit. You need every single customer you can get.
    Good luck to you anyway.

  • Xinch #55 2 years ago

    Whoops! No I didn't actually @trousers. My bad.