Or maybe, it should encourage YOU to make better apps.
You've missed the point entirely. My goal as a developer is to make applications that my customers will buy and keep around for a long time. And I'm happy to say that's what I've done. The problem is that to keep making good applications instead of junk applications, there needs to be enough incentive to produce the good stuff.
Unfortunately, Apple's policies, which includes gives more or less equal promotion to both good and junk applications (with a handful exceptions that receive very good promotion) as well as equal promotion to new applications and updated applications has some bad ramifications:
- Developers are encouraged to create as many applications as possible. Instead of creating one good game, for example, the policy encourages them to produce a set of 4 mini-games.
- Developers are encouraged to produce "junk apps". Afterall, these apps will receive roughly equal promotion as good apps.
- Developers are encouraged to game the system by producing useless updates to their applications in order to be placed back on the front page.
- Developers are encouraged to game the system by dishonestly introducing a product as free, then ramping up the price once the game has hit the top 100 or top 10 list.
All of these effects are negative towards the end user. Moreover, they have a snowballing effect. As more and more junk and novelty apps roll in, high quality applications receive less and less promotion.
Also, while the dramatic drop in prices of iPhone apps over the months does have something to do with free-market competition, it also has a lot to do with the limited ability developers have to market their application in the iTunes store (ex. no movies). Sure, developers could market elsewhere, but unlike us power users, most users just look in the store for apps.
I do not know exactly how I would change the iTunes application store if given the chance. Certainly I would not want to get rid of the Democratic element where anyone can release an application, but Apple really needs to address the issues I've mentioned. It's hurting both their developers and negatively affecting the user experience.