Justin Luey responding to my suggestion that Paper should have charged $0.99 for the app, as well as doing IAP for additional tools:

This might “set the expectation”, but it’s still shady to charge extra for essential features, and it makes the whole transaction more complicated than it needs to be. Charge a fair price for a feature complete app, and offer a free lite version to allow users to demo the app.

I’ve been thinking more and more about my suggestion since I posted it and it is really tricky to suss out. I don’t like the idea of ‘lite’ versions of apps — that’s complex for the user. They have to think about which one they want to buy — they don’t know if there is a free version and so perhaps they just see the paid version and buy that. It’s complex and frustrating.

The reason I like the idea of a paid app with IAP of some kind: longevity. I don’t like my apps to become abandonware and without upgrade pricing for developers on the App Store, there are only a couple of good ways to get continued revenue from the app:

  1. Attract more users, thus selling more copies.
  2. Use IAP to allow the user to buy something extra (including subscriptions).

Beyond that I worry that after a year the developer may move on to greener grass. With IAP the developer can add a new feature and charge all of the users for that feature, instead of just the “new” users.