[xenadu02]

> You couldn't and still can't call out fair prices on mobile software. People weren't and aren't willing to pay those.

I'm not sure if that is strictly true. Prices did vary a lot in the beginning. However scale created a race-to-the-bottom situation for the exact reason you cited: most people wanted to pay less. The market was flooded with apps and games at the minimum price which created a strong expectation among the bulk of buyers.

Consumable IAP is what really enabled the gambling-like mechanics. That was discovered not long after the implementation of IAP and very quickly the game devs that converted to free + consumable IAP started making all the money. IIRC it was an open secret in mobile games many many years ago that the optimal strategy was to make the early game easy to cast a wide net, then slowly ramp up the pay-to-win mechanics to milk the whales as much as possible. You don't really care if everyone else quits - so long as most people get X% of the way through before they do. Then you tweak X% to optimize for catching the most whales.

The super critical aspect is the deliberate ramp. You have to get as many people into the early part of the funnel as possible so some of them will become invested enough to become whales. This also means you absolutely must make the game miserable for 90% of your players but only after they've made a significant investment.