In-app purchases are purchases made from within a mobile application. Users typically make an in-app purchase in order to access special content or features in an app such as power-ups, restricted levels, virtual money, special characters, boosts, etc. The purchasing process is completed directly from within the app and is seamless to the user in most cases, with the mobile platform provider facilitating the purchase and taking a share of the money spent (usually in the range of 30% or so), with the rest going to the app developer.
In-app purchases first became available in Apple's App Store with the release of iOS 3.0 in October 2009. The BlackBerry App World added support for in-app purchases in September 2010, and in March 2011 Google added its version of in-app purchases called in-app billing for Android users.
Apple currently offers four different types of in-app purchases: non-replenishable, replenishable, subscription-based and auto-renewing subscriptions. In-app purchases can apply to premium apps as well as free apps, which are also known as freemium apps.
In-app purchases initially created some controversy due to users not always realizing they were spending actual money on apps, and as a result Apple updated its in-app purchasing as of iOS 4.3, requiring users to first enter their password before being able to make an in-app purchase. The ability to make in-app purchases can also be disabled in most cases, which is particularly recommended when the smartphone is shared with another person or frequently accessed by a child or teenager.
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