IAP (in app purchase) Content Delivery System - What would you be willing to pay? [closed]

Question

OpenFeint has a content delivery system for those who want to have IAP support in their apps. You can just embed the purchasable content into the app on distribution but a much more versatile approach is to use a server that delivers the content to the device. OpenFeint charges 15% of your sales to use their service. I believe this is ridiculously high.

I plan on making this service and making it available to anyone but first I want to know what you would think is a fair price. This would come with a simple SDK to interact with the service and download you content but it would also manage Apple payment verification server side. I was thinking 5-8% would be fair but I want to hear your thoughts. Do you have any ideas on ways to make the service stand out amongst others?

TL;DR - What would you be willing to pay for a content delivery service for your IAP feature in you apps? It would also help if you mentioned how big of a studio/company you are behind.

Answer 1

I don't think 15% are too much, if their service is reliable, secure (as in: people can't easily steal content) and fast. There are costs for decent file servers (you'll need multiple to reduce downtime risk), UPS, rent for the place you're storing the servers in, big pipes (best would be multiple as well to reduce the downtime risk), maybe load balancers, development and administration. It's one of those things that might look simple at first sight but once you break down all the requirements to get this job done you'll see there are a lot of costs, actually.

Answer 2

If you take a look at some of the competition you would be facing, e.g. UrbanAirship you are not that far off from what they are charging for a similar service.

One thing you should make sure, is that it requires a rock solid infrastructure on your part, meaning that it will be costly to host. A few percent on or off the price doesn't matter much, if developers can't trust you to deliver the content with something like at least 99.7% certainty (probably higher).

One thing to remember is that developers will also have to pay 30% of their IAP revenue to Apple. This means that for OpenFeint, developers will have to hand over a total of 45% of their revenue. That deosn't leave much to to development, testing, support, etc. if you also want to make a profit in the end.

So, keep your price as low as possible, but high enough to pay the costs of reliable and secure hosting.