Why 99 cent iPhone apps wont work for you

You are an iPhone developer. You are a small software company. You are not a large company like Apple, Nitendo etc. Then this information is for you!

Why can large or popular labels charge 99 cent for iPhone apps?
Larger companies like Apple can afford to release 99 cent iPhone apps like a remote control for Keynote. Very cool app and probabely similar quality as iTunes Remote. Where iTunes Remote was free Apple now starts to charge for these kind of apps on the iPhone. I have no problem wtih that. They should charge for good software. But, hey, 99 cent. What is the thing to learn here? When you are big you can affort to sell your iPhone app for "just" 99 cent.

They know that they will get the volumes of users downloading the app and thus will be making enough money with a small price tag.

Why 99 cent iPhone apps wont work for you!
Seriously, you wont get the volumes of users like Apple, Tabulous, etc. Try it. I can tell you right now that it is a waste of time. It does not mean that your app is not as good the apps from the large lables. It just means that your app is one of 15,000 apps in the AppStore and not enough people will download the app to make it worthwhile. Unless you developed a blockbuster app such as iFart Mobile 99cent wont wont work for you!

What works for us
jTribe has released so far nine iPhone applications and we tried different prices to find out what the optimum price point is. Prices ranged from free to USD 3.99. We changed prices to see what happnes. We do not develop more "niche" apps and not the blockbuster apps.

Price that work for us is:

• USD 2.99 for a utility application (such as our PinPointMe app)
• USD 3.99 for more complex solutions (such as our "Coming Home Soon" app)
• Free for a platform app that is used to build niche products. We offer FirePin Trip Tracker for free. Then we use the same platform to build more complex but niche solutions we will charge USD 3.99 - 5.99.
• Would we use USD 9.99 as a price tag. Maybe. Currently, I cannot think of a complex enough application on the iPhone to justify this price.
  

These prices work us as "normal" iPhone developers that are not producing blockbuster apps. If you are similar then these prices should work for you too.