The counterintuitive move of giving away apps — or games — for free seems to be gaining ground. The trick is to charge power users for more features or goods:
Game Makers Give Away ‘Freemium’ Products - Brian X Chen via NYTimes.com
Natalia Luckyanova and Keith Shepherd, a husband-and-wife team in North Carolina, learned this lesson when, in August, they released a 99-cent iPhone game called Temple Run. In the game, players must stay a step ahead of angry apes while avoiding booby traps and collecting coins. The game had some initial success but soon started losing traction.
In September, the couple began offering Temple Run free and promoted it through Free App a Day, a Web site that features free games. The game immediately had a spike in downloads and quickly soared in popularity. To date it has topped 40 million downloads, and about 13 million people play it at least once a day, Ms. Luckyanova said.
“When you tell a friend about it and they go to the App Store and it’s free, they download it without thinking about it,” Ms. Luckyanova said. “Then there’s stickiness and the addictiveness and people talking about it.”
But how does the free version of Temple Run make money? Inside the game is a virtual store to buy new characters, different backdrops and power-ups, or special boosters. While players can use the virtual coins they collect inside the game to buy these bonuses, a dedicated few use actual money to buy virtual currency and get them faster.
Ms. Luckyanova declined to say how much money Temple Run had earned, but on Sunday afternoon it was No. 14 in Apple’s top grossing chart, a list of the apps that are making the most money in the company’s App Store.
Freemium has apparently become more lucrative than charging for apps, according to Chen. And now, conventional game publishers — who charge as much as $50 for console games — are taking a long look at the casual/mobile marketplace, although with any revolution the upstarts are more likely to leverage new business models.