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Install this extension:

quarto add dragonstyle/share-post

Learn more, suggest changes, open PRs, and more at https://github.com/dragonstyle/share-post

You can a look at a more comprehensive example (with other formats as well) at https://dragonstyle.github.io/share-post/.

Issues and Release Length

Historically, Quarto releases have actually been relatively short, on the order of 3-5 months. This release took as us much longer than usual. In exchange for all that time, however, we made a significant dent in our issues, fixing more than 700 issues.

It isn’t clear that we can sustain this level of issue closing, but we’re just a few days into Quarto 1.5 pre-release builds and so far we’re exceeding that 2.61 / day rate. I think we obviously won’t sustain that but in the meantime 🍻.

⭐ Stars ⭐

Our GitHub stars have continued to trend nicely.

Lipsum

I often head to a lorem ipsum generator and copy and paste some content into test documents. Instead, I can now use the dragonstyle/lipsum extension to generate placeholder content, like:

{{< lipsum >}}

which will generate 5 paragaphs of lipsum text in my document. More details on the extension can be found in the extension repo.

Unsplash

I also often find myself grabbing images from either a search engine or a random page on the web. Rather than do this, I can now use the dragonstyle/unsplash extension to generate placeholder images, like:

{{< unsplash cat.jpeg >}}

This has the additional benefit of suprising me with frequently delightful images. More details on the extension can be found in the extension repo.

The image accompanying this section was placed in just that way!

Category Concentration

One other category related question that I’ve spent some time thinking about is the concentration of applications in a category- specifically whether some categories are dominated by highly popular applications while others have a larger number of moderately popular applications. To get a sense for this- I used the above ‘Top 25 Popularity’ score and calculated what percentage of a category’s total popularity is accounted for by the top applications. Here are the results:

Games and Entertainment are the least concentrated, interestingly- the massive numbers of applications in the category create fragmentation of the popularity. Finance, which as you recall was a top 5 category, is also pretty concentrated- whoever is winning in that category is really winning.

Pricing

Taking a quick look at the latest App Store data, it looks like pricing has actually stabilized in the ballpark of $2.50.

You can download the CSV and do some analysis for yourself.

In other news, I’m going to appear on a panel for MITX tomorrow. I think registration has closed by now, so you’ll just have to wait with bated breath to hear what deep thoughts are covered…

The most popular premium applications (applications that cost more than $9.99)

The most popular inexpensive applications (applications that cost less than $4.99)

Business Model Emerging

Over the last couple of months, I believe that a business model for paid applications is starting to emerge. Not surprisingly, it looks a lot like the business model that licensed software businesses have been using for a long time (turns out that all those folks had figured something out). That model? Trial versions with paid full versions.

The App Store doesn’t have explicit support for this, unfortunately, but application developers are working around this by introducing ‘Lite’ versions of their applications. Not only are there success stories out there, but the submissions to the store show the increasing popularity of these ‘Lite’ applications. In fact, there are now nearly 1,000 ‘Lite’ applications the App Store, representing about 5% of the total applications.

Looking at the categories, one other very striking thing appears. Application categories that tend to have longer term recurring value (like Games, Business, Finance, Photography, and Productivity) appear to also have the most ‘Lite’ versions.

In some categories, the growth is even more pronounced. For example, in the category of Games, 14% of the applications are ‘Lite’ applications!

But the real evidence of the growing popularity of ‘Lite’ applications (at least among developers submitting applications) is that each month, a growing proportion of the new apps are ‘Lite.’ In February so far, 7% of the new applications are ‘Lite’ applications! And the downward trend of free apps continue as more ‘Lite’ apps hit the store.

The Paid Upgrade Problem

So I have to admit it, as a real fan of the App Store and the iPhone, I’m excited to see a business model developing, especially one that may help improve developer’s ability to collect value for their hard work. And while trial versions are a first step, they are only a first step. For though they let users try a new version before buying, and therefore should allow developers to raise their prices, they still permit developers to collect payment for their work only once.

This is a problem mainly because in traditional licensed software, developers keep working on their application, improving it across a number of different versions. And at the companies that I’ve worked for, the (about) yearly upgrades were a big driver of yearly revenue. Without the upgrade revenue, a rational developer should really wonder whether their time spent improving an existing product will really net more users, or whether they should instead spend their time building a new application that they can monetize.

So while ‘Lite’ should help reward developers who create a deep and rich application experience for their users, I’m not sure it goes far enough. To support ongoing development of these deep applications, Apple needs to do more.

What Should Apple Do?

What should Apple do? I think there are a few things that would go a long ways:

1. The most obvious thing that Apple should do is  provide the concept of trial versions right in the App Store. By providing the infrastructure and user experience around this, they can ‘institutionalize’ the concept of trial software, making it a common and well accepting model. They can also save developers the time of having to create and maintain two applications in the store.

2. But Apple also needs to address the upgrade problem. Apple could allow paid upgrades, but this actually ends up being a real mess since it creates a complicated set of versioning issues (for example, once a paid upgrade has been created, do bugs still get fixed in the old version?).

3. Apple could also enable the concept of ‘subscriptions’ to software, enabling developers to charge something like $.99/month, making it possible to collect longer term revenue for highly valuable applications.

It seems clear that enabling trialing natively is a no brainer for the App Store. Will Apple step up? And could they surprise us by doing even more? We’ll have to wait and see, the App Store remains a young marketplace and each month we all learn something new.

[CSV file of supporting data]

Categories

Looking at the applications in the store, it is clear that the iPhone is an entertainment device. Games and Entertainment application make up more than a third of the applications in the store and typically dominate the top 100 applications in the store. In fact, Games and Entertainment make up nearly 50% of the most popular applications in the store. 

Pricing

While the low price approach of the App Store has continued, I think that the new headline should be ‘99 cents is the new free.’ The downward price trend continues, but most interestingly, but the percentage of applications that are free continues to decline. In fact, soon only 1 in 5 applications in the App Store will be free.

Summary

New SmartPhones (G1, Storm, Pre, etc…) are showing up pretty regularly now. They’re still working on catching the iPhone as far as its integration and slick user experience. The fact that the App Store is continuing to grow at such a torrid pace is bad news for these competitors. Because each new application is a potential reason for a customer to choose the iPhone and each new customer is a reason for a developer to build an application for the iPhone. This virtuous circle is creating tremendous advantage for the iPhone- it’ll make it incredibly difficult to catch Apple, once again.

If you’re interested in doing some analysis yourself, here is my latest raw data (csv).

Games

If you look at games, the downward trend is much more dramatic, but prices appear to have stabilized at just under 2 bucks an application. This, of course, begs the question- games are the most popular application in the store, is this because they’re cheap? Or is this really the best we can hope for- that the most popular category of applications on the store is perceived as being worth about $1.50 an application?

Health and Fitness

Health and Fitness is one of the few categories that appears to be reversing this trend. After an initial price drop, this category has seen average prices rise nearly every month, now approaching $3 an application. And it does make sense- after all health and fitness applications are likely to impact your life much more significantly than a game.

Why Are Prices Headed Down?

Why the downward trend overall? There are a lot of factors.

1. Buyers of consumer mobile applications were already used to paying $5-7 for applications. This set a relatively low ceiling for applications targeted at consumers (who are the main buyer of iPhones).

2. The inability to trial software means that users have to take a risk that they don’t like the software. This risk has to be priced into the software, reducing the price that can be charged.

3. The large number of relatively simplistic and useless applications on the store increase the perceived risk when purchasing software. This increased risk of disappointment forces prices down further. 

4. Of course for many applications (lighters, flashlights, geiger counters) there are large number of substitute goods. This drives prices down. (And while we’re on the subject, do these developers call each other in the morning and decide which sort of annoying application they’re going to build today? How is it that 5 geiger counter applications manage to show up on the same day?!)

There is No End in Site

But the real problem here isn’t that customers like cheap applications. It’s that the way the store is structured today is creating a vicious circle of downward spiraling prices. As pricing pressure forces applications to be less expensive, developers need to respond by reducing their investment in the applications (to make them profitable). This in turn reduces the value of the applications, continuing to increase price pressure. Without some kind of change, I’m not sure where the pricing stops. 

A couple of suggestions

1. Let developers get recurring revenue by charging for upgrades or selling subscriptions. This breaks the cycle by allowing developers to profit from further investment, leaving initial prices low, but increasing revenue from satisfied users who continue to use the application.

2. Grow the user base fast enough that some companies can be profitable even selling something for $.99. Of course, when the price pressure forces the price below $.99, then what? 

Or maybe, this is by design. After all, Apple stands to make 30% of the total app sales, and they don’t need to applications to be expensive. In fact, when you consider that they make money on the app transaction, but also that each new application adds value to the iPhone platform, more apps (even if they’re cheap) is probably better for Apple.