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Previously, in-app purchases had only been available to paid apps, leading to a situation in which developers had to create two versions of the same app if they wanted to offer a trial version of a paid app. Customers had no way of upgrading without downloading a second program, and no way to share data between the two versions of the app.
The change will be a boon to developers, who can now offer a direct upgrade from trial versions as well as offer virtual item sales within popular free apps. That's been a lucrative source of revenue for some developers following the free to play, pay for virtual goods business model growing more widely popular in the video game industry.