For me, it definitely depends on the app. I've paid $20 for some apps and not been upset about it. But most of the apps I've bought have been $.99.

I'll definitely hesitate more if the app is more than $4.99.

It all depends on what the app does, and how useful I perceive it to be. An app like Omnifocus, which syncs with my desktop Omnifocus, is indispensable to me. And it will improve over time, as Apple allows the developer new features, like push notifications.

Some apps are really useful, but only once in a while. Like Guitar Toolkit. I only use it once every few weeks, but I'm so glad I have it when I need to tune my guitar, or figure out a chord I've forgotten. So much easier than digging out my tuner or looking a chord up on my desktop.

For games, I've paid as much as $9.99 for a commercial full-fledged PSP-comparable game, but I do think that the $.99 games tend to be more suitable for mobile use, and I tend to get a lot more use out of them as a result.

Having come from many years of Palms and Treos, iPhone apps are surprisingly cheap. I used to pay $40 or more for many of the better Palm OS Apps. (And most of those apps were necessary to fill the gaping holes in the built-in software.) I think Apple has created a market where a developer can make a return by selling an app cheaper, because piracy is so much harder. Adobe always argues that if everyone paid for Photoshop instead of copying it illegally, they'd be able to charge $100 for it. Apple is sort of proving that true with the app store.

Any way you slice it, iPhone apps are a lot cheaper than desktop apps. I find it hard to deny a developer income, especially since I've spent just a little time researching iPhone development, so I know how hard writing these apps can be.

At the same time, I'd call myself a "moderate" app purchaser. Not quite an addict yet. So maybe I've avoided price sensitivity so far. There are only so many apps you can keep on an iPhone at once before it becomes overkill. I find myself spending 90% of my time in the same five or six apps, so there's not much room for more, unless someone comes up with something I really need that I don't already have.

Glad I'm not alone, however, the comparison to desktop apps or Palm
apps now has me realizing that the iPhone apps are a relative bargain.
I think I'll venture a bit more into that 5 - 10 range and explore.

As far as number of apps, a brief check in iTunes shows I have 136
apps. Not all installed on my iPhone right this second, but my iPhone
is up to 8 screens which is admittedly on the ridiculous side :|

Yesterday, I bought 4 different apps for $4.99 apiece. Often, those that sell in the $4.99 - $9.99 range are established brands, like NBA, or Jeopardy, Monopoly, Wheel of Fortune, etc., where they are iPhone versions of existing PC and Mac games that retail for much more. It's much harder for me to break the $5 barrier, as you call it, for a non-brand, untested game, and yes, I often find myself playing Doodle Jump instead of the ornate high-graphics game that cost more.

Good point about established brand games having the ability to charge
more, I see many in that 5 - 10 range.

I've purchased a handful of $10 apps -- some have been worth it, others not.

After talking with you at lunch yesterday and seeing that iPhone virtual mouse app, I thought I'd test the boast of Apple's TV commercials -- "yeah, there's an app for that!" -- and see if there were any Slimp3/Squeezebox controllers available on the iPhone (Squeezebox is an mp3 hardware/software streaming system now owned by Logitech for home audio use). I figured there *might* be one. But much to my astonishment, not only was there one...there were actually THREE different solutions for this niche product on the app store.

I ended up purchasing the one that had the best reviews on the app store and on web forums. It was 10 bucks. The hardware controller that it replaces would probably cost a hundred or more if purchased alone. The hardware controller, unlike the mp3 receivers and software is not great. So for $10 I was ecstatic that I now had an iPhone solution that actually IMPROVES my overall slimp3/squeezebox setup immeasurably.

Yet another reason why I love this device so much. So yeah, the pricing is all relative. In this case I felt like I was getting a huge upgrade at a relative bargain.

On the other hand, I bought a Chinese dictionary for 10 bucks last year. It was ok. Recently I found another app that was only 2 or 3 bucks. Downloaded it and it was way superior to the 10 dollar app. So the mileage varies sometimes on the value of differently priced apps.

That's cool. I think what I'm getting is there are definitely apps
that are worth $10 plus with a bit of research.