As the owner of one of the most expensive apps on the Market, I vote
for $1.99 or even $2.99.

You have a lot more flexibility with an in app purchase for loyal,
existing users. They already know the product; price is going to deter
them even less than a newcomer. There may be elasticity in the price,
but I'd guess not so much.

I have experimented with price of some in app content. Same item,
starting at 4.99 went to 5.99 to 6.99 to 7.99. It didn't change the
number who bought it. No one complained. Many of them will buy my app
and then rush out and buy several of these, effectively spending up to
$50 (mind you, such people are not the majority, but they are
appreciated). A competitive product, for $3.99, has several of them
built in, though I don't know if they work the same.

My reason for moving the price wasn't pure greed, though I am a
capitalist. Once I got an idea of how many would buy this particular
product, I wanted to reflect the true labor cost of me preparing it.
That should be a primary driver of the price as well. Don't bother
with the subscription if you can't cover your costs, of which your
labor is probably the biggest one.

Whatever your price is, call it an introductory price. You can creep
up and experiment as needed.

Nathan

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