After getting the App Store approval from Apple, many developers are given a whole new world of technology to access. App development costs a lot of money and it doesn’t end there, especially after releasing the first version of an app. Traditionally in the software industry, new major versions of apps are released every 1-3 years with discounts for existing customers. Loyal customers would then be given the chance to upgrade their license in order to receive any new features. This ultimately helps keep businesses sustainable.
Developers tried to follow the same approach via the App Store by releasing new updates and requesting users for a full price to be paid. Services like ‘Fantastical’ and ‘The Omni Group’ are good examples of this. However, this process was always problematic. Because all Apple apps update for free yearly, there are expectations now that when you buy an app/game, you want it to be updated consistently. With new iPhone sizes available, you expect the apps to also be optimised via an update. But if this isn’t done correctly, customers could get upset and leave negative reviews if they have to pay again (for example). With the fresh flow of new customers within the App Store, some developers would just about be able to survive within the market. But with competition increasing, many companies are struggling to maintain their relevance.
Another problem with paid applications on the App Store is that customers can’t test an application before purchasing it. This creates the issue of long-term income from a business perspective because users would rather switch to choosing In-App Purchases with no upfront costs.
The debate between subscription-based apps began at the end of 2016 with Apple and Google introducing reduced subscription App Store fees from 30% to 15% for customers who subscribed for more than a year. Many popular apps that we all use are regularly released with subscription strategies. Password manager 1Password, text editor Ulysses, podcast player Overcast, comics reader Marvel Unlimited and the note-taking app Bear each applies to the strategy. We even have one of our own apps with a subscription feature: goEvo – no diet weight loss.
As you can see, different kinds of applications attempt to conform to this new model. So what benefits do they find? As mentioned in Ulysses blog post, this transition allows free trials and discounts to be available to people – which was not possible before. Ulysses developers made great profit by selling their apps for both Mac and iOS, however, their disadvantage is long term sustainability. And that’s essential for customers too because if you are subscribed to the app and you use it often, you can be confident that the app will continue to exist. As we use our devices for work, it is important to have apps that we trust and trying to find new apps or tools when older ones seized to exist is always a concerning problem. Do you still remember Mailbox, the email client?
Apple seems to recognise these trends very early on and they continue to work on making subscriptions even more attractive for their users. How many services and apps are you subscribed to?