I highly doubt about the crowd out there, if any of them would ever buy "any" app for $500 despite nothing about services or subscriptions or anything mentioned in the app description itself. Coming from your opinion, Nokia Music for example includes subscription features but they have valid reasons for what they charge. Everyone knows app development requires a lot of hard work, resources and most important, investment. But I find raising the price to this height pretty meaningless if app description is nil and no one would ever buy it and especially in this case, where the app happens to be a "Music player"
I think we should not mix IAP into this. This is about the purchase price of an app, and I could imagine niche apps need to be more expensive to monetize.
A scenario that I made in my had is a business companion app for whatever business software.
A thought experiment: Let's imagine a software from SAP that allows you to manage your SAP ERP system from your windows phone. It connects to your SAP system via a secure SAP B2B proxy. Now, SAP wants to offer this as a premium service for the power administrator so in a big company only 2 or 3 people would need it. I don't see why SAP should not be allowed to charge $600 for the app. The costs from this app would be for support, maintenance and the whole secure infrastructure being provided.
Of course that is a very specific scenario and I can't see the average consumer paying that much for an app, but I don't see why a developer can't or shouldn't be allowed to say "this music player I wrote is worth $500". If the consumer agrees, he will buy it, if not the developer will stay without revenue. As capitalists would say: let the market decide.
That all being said: afaik MSFT only checks new app submissions (if you update the actual app) but you'll still be able to update the app subscription, pricing and region availability without it causing a recertification. So the developer could have uploaded it with a $2 price tag and later modified the price.
All in all, there's a button that allows you to report suspicious apps to Microsoft. I am pretty sure that if you report it, MSFT will take appropriate steps.
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