Regarding iPhone Application Pricing

I’d first heard about the I Am Rich iPhone application from my Talk Show co-host, John Gruber. The application costs $999 and has a single function: it displays the image of a ruby on your iPhone’s screen.

According to the description of the app in the iTunes App Store, the developer is making a statement about the willingness of (wealthy or wannabe-wealthy) consumers to purchase incredibly expensive items just to show that they can. A $999 iPhone app that displays an image of a ruby on the screen would fit into that category.

Maybe It’s Too Easy?

A handful of websites, such as VentureBeat, called for Apple to remove the application from the App Store. As of this moment, the app has been removed, but it’s not clear whether Apple or the developer was the one who removed it.

Soon after, Jason Kottke attacked VentureBeat and others:

VentureBeat implored Apple to pull it from the App Store, as did several other humorless blogs.

The first time I saw the app, I also thought it was funny – a clever way to make a statement about consumerism. Kottke continues, justifying Apple’s right to publish the app and the developer’s right to create it:

App Store shoppers should get to make the choice of whether or not to buy an iPhone app, not Apple, particularly since the App Store is the only way to legitimately purchase consumer iPhone apps.

Jason is absolutely right about this – it’s the responsibility of the shopper to know what they’re buying. But I think the problem (and what Kottke may have missed – unless he’s just playing devil’s advocate) is in the potential for the accidental purchase of this application.

For most people, it’s almost too easy to buy something by accident from the iTunes Store. The default option in the iTunes preference pane is to Buy and download using 1-Click. When you click the Buy Song button in a song list, you’ll be immediately charged for the song (or application), and it’ll start the download process.

Take a look at the iTunes preference pane:

iTunes Purchasing Options

The second option, unselected by default, is Buy using a Shopping Cart. Using this feature, you can add, remove, and review the items you want to buy before you pull the trigger.

Update: My friend Ryan Irelan just tested this feature, and it seems that the iTunes Shopping Cart only works with music. Buying iPhone apps still happens instantly, although you are prompted with an “Are You Sure?” pop-up dialog window. That’s at least something. See my “Imperfect Solution” below for yet another alternative.

From the business standpoint, Apple was “smart” to make 1-Click the default option. They realized early on that many of the purchases consumers will make in iTunes will be impulse purchases. What better way to capitalize on the impulse purchase model than to follow Amazon’s 1-Click example.

This sounds fine until you make your first accidental purchase. A few years ago, I made the mistake of re-purchasing a song I’d already bought. Fortunately, it was just one song. But it could have easily been an album, a movie, a subscription to a television series, or an artist’s entire music collection.

Like Kottke, I have a young child. He doesn’t have access to the computer, but he loves to sit with me at the desk once in a while and when he does, he’s quick to try and grab the mouse or pound the keyboard. At almost 8 months old, he’s probably too young to click the Buy Song button – even if we did let him play around.

But what about a two-year old? Or a 10 year old? It’s clear to me that the potential to mistakenly purchase a $999 iPhone application is all too real.

An Imperfect Solution

I debated about switching my purchasing option to Shopping Cart, but I wanted to keep the convenience of the 1-Click model. After poking around a bit, I discovered that you can keep iTunes from “remembering” your password, requiring that you enter it each time you make a purchase. It’s like a little reminder saying, “Are you sure you want to buy this?”

to Purchase

Unfortunately, this option isn’t foolproof. iTunes actually caches your password for the entire session, which means that subsequent purchases will be automatic (passwordless) until you’ve quit the application. The next time you launch iTunes and try to buy something, you’ll be prompted again.

The Burden

So what’s the real problem? Should Apple prevent developers from creating “useless” applications? Should developers be prevented from charging $1000 for their apps? Should Apple make it harder to make a purchase? Should users be entitled to any recourse if they “accidentally” buy a $999 application that does nothing?

I believe that there’s a shared responsibility here. Apple shouldn’t restrict application pricing or availability (for non-malicious apps). Users need to be careful about the purchases they make – and Apple makes provisions for this. At the same time, developers should be conscientious, considerate, and kind when creating and pricing an application.

Of course, there will always be somebody who will push the envelope and test the limits of every system. This isn’t necessarily a bad thing because it heralds change and inspires innovation, but there’s a price, and these days, we all have to pay it.

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