As we head toward the end of the year, Apple has responded to one of the more frequent requests its App Store developers make in the form of more flexibility when it comes to setting prices. Developers will also gain new flexibility to manage pricing globally and can expect additional tools, which Apple will begin rolling out today and throughout 2023.
Developers gain better pricing controls
The big change Apple made is to give developers 700 additional price points to use when setting prices for their apps. The latest move is the biggest improvement involving price capabilities Apple has made since the launch of the App Store.
At that launch, then-CEO Steve Jobs explained that every developer dreamed of offering their app to every user, something that was far from possible at that time. “Most developers don’t have those kind of resources, even the big developers would have a hard time getting their app in front of every iPhone user,” he said.
Apple has augmented the additional prices with tools to facilitate setting prices per App Store country or region, tools to manage foreign exchange rates, and other improvements.
Now, up to 900 price points are supported
The new system means developers can choose among 900 price points, nearly 10 times the number of points previously available for apps. Prices start at 29 cents and can go much higher. In fact, Apple says there are hundreds of new prices and an additional 100 higher price options — as much as $10,000 — which are available on request. This makes sense, and reflects what Apple learned historically in the early days of the App Store when the infamous and useless $999 ‘I Am Rich’ app briefly appeared.
In a little more detail, there’s a selection of price points that increase incrementally across price ranges. There are 10 10-cent increments up to $10, 50 cent increments between $10 and $50 and so on. Apple plans to publish a table detailing the prices on its developer site.
Useful tools for more efficient currency support
While in the US and UK the convention is $x.xx or £xx.xx, some national currencies have different numbering conventions, such as when prices begin with two repeating digits (e.g., ₩110,000). This has been a small but annoying problem when setting prices; developers can now price products beyond $0.99 or €X.99 endings to incorporate rounded price endings (e.g., x.00 or x.90), which are particularly useful for managing bundles and annual plans.
Better tools for currency fluctation
Developers of subscription apps can now manage currency and taxes across storefronts more effortlessly by choosing a local storefront they know best to automatically generate prices across the other 174 storefronts and 44 currencies. (Developers can still define prices per storefront if they wish.)
This capacity to set prices by storefront will expand to all other apps in Spring 2023. This is useful, as it gives developers some form of hedge against currency fluctuations, as I see it. This means, for example, a Japanese game developer who gets most of their business from Japanese customers can set their price for the Japan storefront, and have their prices outside of the country update as foreign exchange and tax rates change.
Another fillip to localization: All developers will be able to define availability of in-app purchases by storefront.
Coming next year, developers with paid apps and in-app purchases will be able to set local territory pricing, which will not be impacted by the automatic price adjustments Apple sometimes applies to reflect changes in taxes and foreign exchange rates. (It applied such changes across some territories in September). Currently, developers can adjust pricing at any time to react to tax and foreign currency adjustments.
Why does this matter?
Apple’s App Store drives the iOS app economy which has enabled the rapid evolution of a mobile apps industry since the store first appeared in 2008.
Now, we know Apple’s success has attracted criticism, some (not all) of which may even be justified. But we also know that developers have derived significant benefits from the development tools and store front Apple provides.
These extensive tools include things many consumers may take for granted because they have become so used to using them — including frictionless checkout and transparent invoicing, robust marketing tools, tax and fraud services, and refund management. All of these would be more complex under more fragmented systems.
These new pricing enhancements will be available for apps offering auto-renewable subscriptions as of today, and for all other apps and in-app purchases next spring, That means developers will gain greater price-setting powers to sell their products in 45 currencies throughout App Stores globally.
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