Microsoft has announced they are raising the limit of free applications a developer can submit from 5 to 100.  But what does that really mean?

First, lets look at the reason for the limitation.  The iTunes Store and the Android Market both have a lot more applications available than the Windows Phone Marketplace.  But that says nothing about the quality of those applications.  I attended a couple of pre-launch events and Microsoft representatives were clearly told to send a message. We don’t want a bunch of junky applications that do nothing but spam the marketplace.  That was the reason for the 5 free application limit.

Okay, so now what has the result been?  Well, there are still fart apps, but there is no sign of a developer flooding the marking with 1500 wallpaper applications or 1000 of the same application all pointed at different RSS feeds.   On the other hand there are developers who want to release real free apps but are constrained by the 5 app limit.

So why did Microsoft change it’s mind?  Is it to get the count of applications up, or is to make developers happy?  Windows Phone Marketplace is growing fast but it’s a long way behind the other guys.   I don’t think Microsoft wants to have 100,000 apps show up in the next 3 months if they are loaded with copy cat apps.  Those numbers will get picked apart quickly and the press will start complaining about  the same problems the Android Market has.  I do think the bump was at developer request.  Microsoft is usually good about listening to developer feedback, but has been pretty slow about it at times.  And from a financial perspective, there will me more apps that Microsoft has to review that they will see no profit on.  At least not until they bake in a advertising model connected to Bing.

Ultimately, what does this mean for the future?

Well, there are developers out there looking to release more than 5 simple free apps, so I think we will see more hobby apps.  And there are developers out there trying to make money from advertising instead of sales, so I think we will see more of those also.  But the category that I think will grow the fastest is free versions of paid applications that are the same as the trial version of the application.  While technically that makes no sense, its purely a marketing move.  Free apps get downloaded a lot more than paid apps, even with a trial mode.  It always surprises me how little consumers are willing to spend on mobile apps.  How many reviews of applications have you seen that says something like “a bit pricey at $1.99”.  Really?  Have you looked at how much you spend on your phone and plan?  I always thought the trial mode baked into Windows Marketplace was a good idea.  So I’m not sure how the more open free market will play out.

In the long run though, I won’t be surprised to see a Bing ad mobile ad model show up so Microsoft can capitalize on the more open and free Windows Marketplace.

Bonus: The Oatmeal on How I Feel About Buying Apps