The entire Apple community has spent much of the last several years coming to terms with the post-App Store software market, where people won't pay even a few dollars for a great app, but will pay hundreds of dollars to get a higher score on Candy Crush or a better looking Springfield on Tapped Out. But it's not just games, as Marco Arment points out:
This is the real reason why Apple doesn't care about upgrade pricing: there's no demand from customers. The market has shown that free apps will be downloaded at least an order of magnitude more than paid-up-front apps, and smart use of in-app purchase in a free app is likely to make more money. Over time, this trend has only become stronger and more clear.
Paid-up-front iOS apps had a great run, but it's over. Time to make other plans.
It's not the App Store some of us want, but it's the App Store most of us have decided to support and reward. Whether we look back at the simpler time when we paid a fair price for a great app and incrementally upgraded from there as the dark ages, or as the good old days, remains to be seen.
As does the types of apps this in-app future, fully realized, will bring.
Source: Marco Arment