Developers wrote an open letter to Apple complaining that the 99-cent and free price points of the software available through the iPhone Apps Store is prohibiting them from making compelling software.  They claim they cannot recuperate the development costs of a complex program at 99-cents.  While reading this article, I couldn’t help but burst out laughing hysterically as I imagined a bunch of “entrepreneurial” programmers coming to grips with what “open source” truly means.  They got what they asked for and now they are whining!  OMG!!!  Heheheheh!!!  I’m still laughing.

Okay, let me stop and wipe the tears from eyes and say this:  there is a perceived value to iPhone applications.  People associate programs made on an open platform with free ware — programs made out of the goodness of a developers heart and not for profit.  This has nothing to do with ringtone pricing.  So how do the developers make money?  Obvisiously this open letter shows a serious lack of creativity, marketing, and business sense, which is not surprising — these folks are programmers.  I am unwilling to call these folks developers because I think “development” implies the whole ideation, programming, business, marketing package.  Anyhow, here are some ideas:

• If developers want to sell their wares for more than 99-cents, then they need to convince customers that their products are worth more.   If they can’t put a good demo on the apps store, then link to a website and show a more in-depth demonstration or simulation — it is an iPhone after all ;p .
• Developers could get together and create a clear tiered structure of applications and agree to pricing based on complexity and man hours.  Of course, the iTunes Apps Store is a very pure form of capitalism, so it’s possible that another developer will undercut the agreed upon pricing structure.  Yes, they are competing toe-to-toe with International developers who can do the software cheaper in their own country.
• Developers could get together and make up some sort of certification that in essence states that the software is not “crapware”
• They can also turn to the deplorable world of advertising to subsidize the cost of the program.
• They could also do the application concept and architecture in the US and outsource the programming to a cheaper country or hire high school and college interns.
• They could work with the service provider to get a separate marketplace with some form of certification
• They could tier the applications, such that basic functionality is offered at 99-cents and additional functionality can be obtained with the “full version” — or the usual “basic”, “professional”, and “ultimate” type labels.
• They could show a comparison table between their product and the competing “crapware” and point out the clear advantage that justifies the increased cost.
• They could make iPhone applications to bridge existing services, say,  in the model of Pandora.  Or they can make iPhone apps for established companies — in other words, shop the basic concept around before going to the iPhone store.
• Get the applications in front of some prominent bloggers and tech reviewers who will get your message out for you.  After all, Apple and techy people do whatever tech evangelists say is cool.

I have an iPhone and I’m wary of putting any willy-nilly application on my phone.  For the most part “Free” and “99-cents” don’t catch my attention.  It only took one piece of crapware for me to change my attitude quickly.  My iPhone is precious and I don’t want to litter it with programs I will not use.  I’m very selective about what I put on my phone.  It has to match activity that I’ve tried doing with my phone or be something that I, myself, thought would be neat to have.  As for pricing, it depends on the perceived value to me.  If I wanted a “quote of the day” generator or a lighter simulation, then I feel that should be free or 99-cents.  If its a  multi-level game, then I expect to pay $5- $10 based on complexity and replayability.   If I want location based software to find product and services around me, then I expect to pay no more than 99-cents or for the software to be free because I understand that I will be advertised to in a very micro-targeted fashion.  Anyhow … the whiny programmers that wrote the open letter to Apple need to get their heads out the sand and get creative.