Is Apple killing paid upgrades?

Apple’s release of Logic Pro X has brought users of the company’s audio authoring software a slew of new features. By all accounts, it seems to be an excellent update to a very popular app used by thousands of artists, famous and otherwise.

One thing that’s not included in the package, though, is an option for existing customers to upgrade from Logic Pro 9 for a reduced price. Regardless of whether you’re approaching Logic for the first time, or you’re a long-running user of the app, getting your hands on this latest version will set you back a cool $200—no exceptions.

In a sense, this was to be expected. Logic, like almost every other piece of software Apple offers, is now distributed exclusively through the Mac App Store, which doesn’t make allowances for any upgrade mechanism—something that developers and users have complained about almost from the moment the store was announced.

Until now, many of Apple’s consumer apps have received free updates—the one notable exception being OS X. This approach, however, cannot work for higher-priced “prosumer” software, which reaches a smaller market and cannot easily be justified simply as a way to incentivize customers to purchase the company’s hardware.

And, while the folks in Cupertino could have probably made a one-time change to the way the store works for their own benefit, it’s likely that the uproar over giving its own software preferential treatment—while forcing all other developers to live sans upgrades—would have been significant, and rightfully so.
Logic Pro X: One price fits all

  One way or another, it’s been clear for some time that Apple has set its sight on paid-upgrade cycles, and that the tech giant is intent on making those cycles a thing of the past.

There are at least a couple of reasons why this makes sense from the company’s point of view. The first is that upgrade pricing introduces confusion in the customer’s mind: If someone can buy a piece of software at a lower price, why can’t everyone? In addition to signalling that software is worth less than its full price tag claims, upgrades create an artificial barrier to entry for new customers, leading to reduced adoption and higher support costs.

Obviously, the lack of paid upgrades also pushes developers to offer more free updates, which plays into Apple’s attempt to create an ecosystem where software for its devices is cheap and plentiful, making it easier for consumers to swallow a premium price for its hardware.

Consumers have benefited from Apple’s scheme by enjoying generally-lower prices. Just a few years ago, Logic Pro cost $500—which means that, assuming that the new pricing holds, you now would have to buy three versions of the software before you’d spend as much money as just one at the old price. The same goes for many of Apple’s consumer-level apps as well, including OS X, which will now set you back a fraction of what you would have spent just a few versions ago.

For developers, the bag is decidedly more mixed. Coupled with the App Store’s generally depressed (and depressing) prices, its lack of support for paid upgrades makes life very hard for companies that have an established customer base long accustomed to incremental pricing. And even those who are publishing their app for the first time directly on the Mac App Store face an uphill battle trying to sell customers on the idea that they should fork over the entire purchase price again to get their hands on a new release.

This makes Logic Pro X’s release that much more relevant, particularly if the lack of upgrade pricing becomes part of a trend: The fact that the world’s largest tech company may have foregone the traditional approach towards upgrades can only signal to customers that a fairly-priced app is a good idea even if you have to fork over the full price every time a major update comes out.

And there is reason to believe that this will trickle down to third-party developers, who can jump on the bandwagon and adopt a distribution strategy in which small updates are free, and major releases are priced independently as separate products. In the long run, this might mean both higher revenues and a customer base that is more receptive to prices that are reasonable for both sellers and buyers.