I’ve used iStockphoto.com for I think 9 years now. They started as a sharing community with no charge. Then I remember downloads costing $0.25 for the highest resolution image (they only came in one size then). Nice and cheap still. Now today as I went to buy more credits for some of the homepage images (I’m creating the “crowd” from individual shots that I’ve picked) and the least amount of credits you can buys is 12 and then 26. Basically it ends up being $2/per credit. The xsmall images are a credit each (which are only good for small pictures on the web). Seems a bit pricey now. So had to get resourceful instead of using a credit for the grapes cluster I thought, “I bet if I do a google images search I could find a generic one that will work for me” also did this for the plate to put the salmon dish on.
My point. With raising the prices on iStockphoto.com they attract more serious photographers therefore there are more professional and higher end images. So better quality, good for us consumers. But with raising the prices on the consumer end I am thinking of how to be more resourceful and spend less credits. If they were a $1 per download I may have bought a few more pictures for my graphics without even thinking, and may have spent almost the same amount. Or maybe they rig up a tiered pricing system that prices lower for generic shots and higher for the more popular ones.
The same is going with iPhone apps right? If an app is only $0.99 then I am apt to download it without much thinking although the quality of the app may be exceptional or poor. Not much personal loss.
From an economy/tax example…
In 1916 the US government had a tax rate of 7% on incomes over $300,000 which produced about $80 million (1,296 returns filed)
In 1921 the US government had a tax rate of 77% on incomes over $300,000 which produced about $85 million (246 returns filed)
All the price raise did was increase tax evasion and avoidance.
Apple did a very smart thing by allowing $0.99 song downloads and $9.99 (varying) album downloads. What this did was stopped my resourceful evasive mind from thinking how else I could get the music to going with the simple, convenient and relatively cheap method. In fact I’ve bought albums again that I couldn’t find the CD for.
Convenience + low price point + wide reach = profit
…sorry for stating the obvious.