Study: Consumers Will Pay $5 For An App That Respects Their Privacy

Ever since the iPhone came out in 2007, the going rate for many of the most popular apps has been exactly $0.00. Consumers pay nothing. But of course, nothing is free. Instead, consumers pay with their data, that's sold to marketers, or with screenspace, which is forked over to make room for ads. It's a trade consumers are happy to make. But are they?

A new study from economists at the University of Colorado finds otherwise. It shows that the average consumer would prefer to pay small fees for their apps, in exchange for keeping their information private and their screens uncluttered. Because the "average" app (as determined from a sample of more than 15,000 Android apps) has both advertising and access to a person's location and their phone's ID, Savage and Waldman say that paid versions of such apps could rake in somewhere around $5 per download. That's way more than the pocket change that most free apps bring in per download.

[Dec 26]