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Smartphone users paying dearly for mobile applications


Nearly a fifth of smartphone owners paid more than $100 for mobile applications last year. A new survey by ABI Research shows that 17% of smartphone users spent less than $500 but more than $100 on mobile applications in 2008 – a level of spending which referred to within the report as "significant".

Some mobile applications cost less than a dollar, while others are more expensive - nevertheless, even the top end mobile applications tend to be capped at around $20 or $25, so the results of the study would seem to imply either that mobile applications are highly desirable, or that the prices are beginning to increase sharply.

Analyst Jeff Orr from ABI Research thinks it's a combination of both. In particular, he believes Apple's App Store is responsible for a dramatic increase in mobile application prices when consumers purchase them from other providers: "Apple is seen by some as hurting the market with its iPhone App Store," said Orr in the report. "It drives the price of content down to $1-2, using a model similar to its successful iTunes music store. If you exclude Apple from the mix, applications for other platforms cost about $7-25 each."


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