OK. There are still apps that will cost you nothing to download, but they won’t be referred to as “free.”
Apple introduced a small but important change in how apps are presented in the App Store. Users will see a “GET” button next to a non-paid app, instead of the previous “FREE” button when browsing apps in the App Store. There is no public reason for the change, but we can speculate that the change is prompted by several controversies around non-paid apps with in-app purchases.
The change is likely targeted at mobile games leveraging a freemium model, where the apps are free to download but require a user to pay for certain privileges within the game experience. Major app publishers, including King’s Tommy Palm, believe that the future of gaming is free-to-play. In fact, 92% of iOS revenue in 2013 came from freemium games. The trend shows no signs of slowing down, especially with hit games like Kim Kardashian’s Hollywood App earning $43M in just three months. So, why fix something that isn’t broken?
As you may recall, Apple reached a major settlement with the FTC earlier this year, paying millions of dollars in refunds to customers who felt that Apple’s billing practices were unfair and describing apps with in-app purchases as "free" deceptive to consumers. Similarly, Google stopped referring to free apps with in-app purchases as “free” in cooperation with the European Commission back in July (this practice has yet to spread outside of Europe, although it’s likely a matter of time). The FTC also sued Amazon for the same core issue earlier this year.
The change makes complete sense from Apple’s perspective, but does it solve the problem for consumers? Moreover, does the change help app developers?
I’d argue that the word “get” is no less deceptive than “free” to a consumer. “Get” implies that after tapping a button, a consumer owns whatever the app is. In reality, however, a user only owns a portion of the app, a carefully measured portion that an app developer has (possibly very strategically) determined is enough to entice a user to spend money in that app.
The impact of the change on App Store downloads and purchases remains to be seen, although Marcos Sanchez, VP of Global Corporate Communications at App Annie, is unsure that this change will impact buying habits in the App Store. “I’m not completely sure, but one could argue that it is a more ‘action’ oriented, pro-active word, which could have a positive effect as a call to action. Small changes can sometimes have a positive impact.”
Does Apple’s change improve the situation? How can app stores be transparent with consumers about in-app purchases without hurting app developers’ installs and revenues?