When making billions of dollars is bad

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

I don't know about you, viewers, but I'm getting really, really tired of  listening to complete arsewits in the idiot games industry bitch about how low prices in the App Store are damaging to game developers.

The latest outpouring of drivel, from the famously stupid and clueless Rob Fahey of gamesindustry.biz, notes that the App Store has been an "immense success" with regard to gaming – and quite rightly so, given the staggering size of the market it's created out of thin air in little over a year.

Yet just a few paragraphs later, the piece calls the Store's business model a "destructive cycle", refers to the impulse-buy pricing that has made it such a success as a "problem" and speaks of the "destructive downward pressure" brought about by cheap games, predicting all manner of doom and catastrophe if people keep happily spending billions of dollars on them.

Just for fun, then, here are the actual FACTS behind the claims that you can't do well on the App Store unless "destructive downward pressure" forces you to sell your product for 59p.

 

PRICES OF TOP 100 PAID APPS, 24 April 2010

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

Highest price in top 10: Football Manager 2010 (£6.99, no.10)
Highest-priced game in top 100: Chaos Rings (£7.49, no.65)
Highest-priced app in top 100: NDrive (£9.99, no.61)

In other words, a little over half of the top 100 is made up of apps selling at the lowest permitted price. 41% of the Top 100 apps made it into the chart despite being more expensive than the minimum.

Perhaps more interesting, though, is the top-grossing chart, showing what actually made the most money.

 

PRICES OF TOP-GROSSING TOP 100 APPS, 24 April 2010

Free: 3 (these are so-called "freemium" games costing nothing to download but with in-app purchases for extra features)
59p: 21
£1.19-£2.39: 17
£2.99-£7.49: 39
£7.99+: 20

Highest price in the top 10: £59.99 (TomTom Western Europe, no.4)
Highest price in top 100: £99.99 (TomTom Europe, no.38)
Highest priced game: £7.49 (Chaos Rings, no.14)
 

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

1. More expensive games (the £1.19 to £2.39 bracket, where most games over 59p are found) 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.

3. You can ALSO make lots of money out of selling games at higher prices, like Football Manager (£6.99), Call Of Duty: Zombies (£5.99), 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 in the App Store 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.

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8 Responses to “When making billions of dollars is bad”

  1. I do throw money away on the cheapos, just in case they are good. |'m more hesitant to spend £3+ on a whim. 9 times out of 10, I only get serious play out of 1 in every 4 games I buy… (what an odd statistic)

  2. I don't think you really understand publishing, the use of the word "good" to define content you would like to be created and a belief that such content creation would be rewarded is a dead give away.
     
    Try stepping away from the emotive word game or app  and replace it with ringtone, re read what you just wrote with that word replaced.
     
    Maybe you don't want to believe that there are any parallels between ringtones and iphone games, but just try and consider the possibility for a little while. Maybe the fact that all the high priced games you mentioned are franchises will help you.
     
    PS I don't agree with the shit you are commenting on either, just check your own mind for faults too.

  3. I don't pretend to know the first thing about ringtones. Do you have a point to make, or did you just come here to lay some riddles on us?

    PS Since when was “app” an emotive word?

  4. Sour grapes Says:

    I don't see any harm in this. It is expanding both the sales models, markets and the range and types of offerings out there (there's a lot of cheap crap that people will try on a whim because it is easy and instant, but would never go out of their way to buy in a box in a shop, take home, install on the PC, etc.). If they don't want to sell iPhone software, then don't. No one is forcing them. Leave it to the others.
     
    If their not moaning about "evil piracy" they are moaning about "evil competition" with other designers. I've never seen such a whiny industry elsewhere. Seems like sour grapes to me.

  5. I agree that the lower price points on the App Store aren't a "problem" in the way Fahey is suggesting. A common strategy (other than using in-game purchases) seems to be to use the 59p and 0p price points as limited time offers. The rest of the time, anything under £2.00 still feels like an impulse purchase.

    However, "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." – The App Store charts are far from a perfect indicator of quality. There are many excellent games that lack the marketing, relationship with Apple (or only have that in their native country), or obvious appeal to the general audience that will struggle to make money purely through lack of visibility. For instance I would have no idea Espgaluda 2 even existed if I relied on the App Store and the patchy app reviews online, and I doubt that's a one-off.

    If Apple introduced some feature that automatically told me what games my friends had (and were playing the most), that would make it harder to miss good games and would reduce the time spent sifting through crap.

  6. I think someone swallowed a back-issue of edge without remembering to chew (ooh, "flaming", i do apologise).

  7. "There are many excellent games that lack the marketing, relationship with Apple (or only have that in their native country), or obvious appeal to the general audience that will struggle to make money purely through lack of visibility."

    Yes, of course. I perhaps should have made the point clearer, but I thought it was obvious that it referred to games that people HAD seen and therefore made a judgement on, because price can't be an issue about a game nobody's seen in the first place. Visibility of apps is a whole separate matter.

  8. Sour grapes Says:

    Indeed. The issue at hand was PRICE and price is only relevant if you know it exists. That was what quoted chap was moaning about.

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