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Apple to raise App Store prices in 28 countries
No reason given, but inflation and app tracking changes may both factor
Customers of Apple's App Store in several countries and the entire Eurozone should expect price increases beginning as early as October 5.
Prices of apps and in-app purchases (IAPs) are set to increase [PDF] in Chile, Egypt, Japan, Malaysia, Pakistan, Poland, South Korea, Sweden, Vietnam, and the 19 states using the Euro.
Apple's note announcing the price hike was directed at developers, who will see proceeds adjusted according to price increases, and, in the case of Vietnam, new taxes. Auto-renewal subscription prices aren't affected, and Apple said that developers can, if they see fit, change the prices of their apps in response to Apple's hikes "at any time in App Store Connect."
While Apple hasn't stated the reason for its price increases, Reuters and several other publications have pointed out that inflation and other economic factors have driven the value of several currencies down versus the dollar recently, meaning Apple's bite of the profits coming from overseas has also shrunk.
In particular, the Euro hit a two-decade low versus the dollar at the end of August and hasn't budged much since, while the value of the Yen recently fell to a 24-year low in early September. According to Reuters, similar drops in valuation have also hit "most emerging economy currencies."
The price changes vary between countries, with a 20 percent jump in the Eurozone and a more than 30 percent hike in Japan. Apple routinely adjusts pricing for apps from country to country, a scroll of its developer newsfeed shows.
It's not all inflation
While inflation is undoubtedly a factor, Apple might be trying to get a bigger cut of new app-buying habits that have changed thanks to its own App Transparency Tracking (ATT) initiative, which caused some 85 percent of iOS users to reject third-party tracking on their devices.
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According to app market analytics company Apptopia, the price of an in-app purchase in iOS apps has increased by 40 percent since July 2021, while Google Play IAPs only rose by 9 percent – just half a point more than the consumer price index change over the same period.
Apptopia said that the rise in iOS IAP prices (coming not from Apple, mind you) started before the steep inflation, "indicating publishers may actually be reacting to increased effective cost per install (eCPI)" thanks to ATT. Apptopia noted that IAP prices have kept pace with changes in iOS eCPI, which is a measure of what it costs a publisher to get a user to install its app.
Most of the spike has been in one-time IAPs, which rose 30 percent year-over-year between July 2021 and 2022. Apptopia said that subscription prices only rose 19 percent over the same period, which points to publishers "trying to present a value and hook customers for longer to cut down on acquisition costs."
That's not to say Apple has been losing money due to ATT – the move has been a huge windfall for Apple's own advertising arm. Apple's Search Ads, which display in the App Store and are used to promote apps, have jumped since ATT's introduction to become one of the top three mobile app advertising platforms along with Meta and Google's.
Like developers, Apple is watching inflation. Past habits, however, indicate Apple is still intently focused on the market shift it created, and is responding accordingly to keep its coffers filled. ®