Apple alerted developers to some App Store price adjustments earlier in the week and the alternative price tier details have now been posted. Apple has added other alternative price tiers in the past, but what’s interesting with these changes in particular is is that they are specifically targeted at offering really low price options for apps in a select few countries.
The new tiers enable developers to set prices for their apps way below the usual $0.99 price floor in India, Russia, Indonesia, Mexico, South Africa and Turkey. (Special pricing for China has existed for some time.)
For example, using the ‘Alternative Price Tier A’ means that apps are priced at 10 Indian Rupees. This is equivalent to about 16 cents in USD. Before the addition, the lowest price developers could charge in India was 60 rupees, which is about 96 cents.
China’s new pricing is extremely close — 1 CNY again converting to 16 cents in American currency. In Mexico, the alternate tier sets prices at 5 MXN, or about 30 cents. The most expensive of these countries is South Africa, with the new price tier offering 3.99 ZAR — equivalent to about 32 cents. Apple also offers an Alternate Tier B for every one of the countries which are higher than the A tier but still under the ‘normal’ 99 cent pricing.
Apple has not offered an official explanation for the sudden addition of these additional price levels. This is speculation but it seems that Apple is offering developers the ability to sell apps at cheaper prices in price-sensitive countries and emerging markets. Developers may benefit by offering their apps at these lower prices with the lower price tags attracting more buyers, hopefully causing an increase sales sufficient to offset the lost revenue per purchase.