As a developer with an app in the app store, my big problem really is with the users. Now, hear me out. It's a sad but true fact that only a small percentage of users buy apps above $0.99. As a developer this is disheartening because the more work I put into something, the more I would like to be able to charge, but unless your app is under a dollar, it just doesn't move. This race to the bottom has hurt overall app quality, IMHO. There is no incentive for a developer to spend time on a quality product if they have to price it at $0.99.
Just my opinion, but that's what I've noticed. But this may explain why there are 400 different fart-based applications.

Development seems to be trending towards meeting the needs of the lowest common denominator.