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Day January 31, 2010

iWork for the iPad: Game changer for the software business

Amidst all of the positive and negative opinion pieces and postings which followed Apple’s iPad announcement this week, the impact to software businesses are only starting to become apparent. I think Apple’s announcement that iWork pricing will be $9.99 per app is significant.

It’s game changing not for third-party ISVs already developing for the iPhone, since they’re used to charging 99 cents to a few bucks for an app. For Mac software developers like OmniGroup, it’ll be challenging. There is already a large Mac software ecosystem with apps priced in the $20 – $60 range. These ISV’s have continued to charge such prices even while iPhone app prices dropped a zero, because the difference in functionality and screen size between a Mac laptop and the iPhone is significant. The difference in what users can do is significant.

iWork on the iPad is a laptop/desktop experience, suitable for the vast majority of home and many business users. And yet Apple dropped a zero on the pricing, basically. With a presentation program, word processor, and spreadsheet available for $10 each, or $30 for the entire productivity suite, how will third party ISV’s charge $50 or $60 for an iPad version of their Mac software apps? Perhaps they can’t.