Joe Sriver, founder and president of DoApp
Most of the applications on the iPhone AppStore are free. So the rumour among iPhone developers is that the only one really making any money with iPhone apps is… Apple!
DoApp is one of those iPhone developers who have experienced it the hard way.
The 7 person startup developed myLite one of the most popular iPhone application that transforms the iPhone into a flashlight and which was downloaded over 1.5 million times since July.
DoApp initially charged for myLite but eventually gave it away for free because so few iPhone/iPod touch users were willing to shell out the 99 cents it originally cost.
However the Minneapolis, Minn., based company has not given up and hopes to reiterate the success of myLite with Punch-O-Meter, another viral application that lets you throw an “air punch” with your iPhone or iPod Touch that then calculates a score based on the punch’s accuracy, speed, and strength.
This time, the self-funded startup hopes to make a buck… selling its latest app for 99 cents! But will consumers buy it?
Charging for an iPhone app can be a risky business… Free is always better
“We’re still experimenting with mobile pricing. Our philosophy is that a mobile application should be as cheap as a Starbucks coffee or about the price of downloading a song. We think the price points should range between 99 cents to $9.99. Beyond that I don’t think consumers will be willing to pay for it even if they spend over $200 to buy the phone,” says Joe Sriver, DoApp’s founder and president.
Punch-O-Meter took “only” 8 weeks to develop and is DoApp’s 7th application, with 3 more consumer apps to come shortly. “And despite the 100 to 200 iPhone applications submitted every day, Apple has greatly improved the length of its approval process that went from 2-3 weeks at the launch of the AppStore to about 3-4 days today,” adds Sriver
In case, charging for the application fails, Sriver is also looking at advertising. “The advertising market is in a disarray at the moment because of the economy. But we’re looking at new ways to advertise, based on location.”
Just like with Web agencies during the dot-com boom, large marketing firms will start buying Mobile agencies
To compensate the lack of revenues coming from its software, DoApp is doing some “studio” or agency work developing iPhone applications for other companies. “I’m surprised of the rate these clients are ready to pay for us to write applications for their particular product. We actually have the luxury to pick and choose which apps to do and turn down projects we don’t like,” admits Sriver.
Long term, DoApp does not intend to grow its development services but will not shy away from a good project. “Will take the check”, jokes Sriver. “Demand for good iPhone development is not going to slow down. And I expect advertising and marketing agencies to start buying iPhone and mobile development houses just like they did during the tech bubble with the Web agencies.”
