The world of technology as we know it is changing. With the iPhone, Android, and now the iPad, computing is becoming more and more mobile. You can do more when away from the office or on the go.
Along with these advancements have come the applications, or apps that go with them. There are apps written specifically for the iPhone/iPad, Android devices, Blackberries, and Palm phones, among others. There are even entire app stores dedicated to distributing these apps.
There is one major difference I’ve seen about these apps, however, and that is the pricing. For the iPhone, you are hard pressed to find an app that sells for over $1.99. In fact, over 75% of apps in the app store are under the $2.00 mark. Compare this to the average desktop software, which probably starts at around $20 and can range up to the thousands of dollars for specialized applications. Think about it. Many of my iPhone apps which were free or cost $.99 have more functionality than desktop apps on my computer.
I see a major change coming in the market. I think that with the advancement of software development tools and the increase of mobile devices such as the iPhone, iPad and Android devices, consumer application costs will fall. Gone will be the days of paying $300 or more for word processing capabilities, or over $500 for the capability to create forms. All of these applications will be available for pennies on the dollar. Either these large software companies will find a way to provide them very inexpensively, or they will go out of business as consumers move to mobile devices on the strength and price of their apps.
Take, for instance, the video game market, which is largely consumer-based. Sim City for the desktop will run you $19.99, while you can get the iPhone version for $4.99 (down from $9.99 previously). Or document editing, where Microsoft Office will run you around $350, but the iPhone version will only set you back $16.99. Or iMovie for the iPhone, which is $4.99 versus the desktop version which runs $49 (although this does come with a suite of products).
The exceptions I see to this trend are:
- Applications that are for specialized business use such as accounting packages and design and graphics programs
- Online services which often charge a premium in order to be able to use their iPhone app
My point here is, you can see the trend of consumers being willing to pay less and less out of pocket in order to meet their needs. After all, it is much easier to spend $.99 on a whim than it is to spend $300, $100, or even $20. Forward-looking providers will see this and adapt their business models accordingly… or cease to be.
