I wouldn’t expect anything like upgrade pricing to appear in the Stores. It seems like the message is to either give your upgrades to your customers as free updates or to launch a new app and charge everyone again.
It’s not perfect; there’s no way to offer different prices for people who are upgrading an app versus those buying it fresh. But I think Smith is right — this is how Apple will be offering upgrades, and this is how they expect developers to offer upgrades.
A side effect of this is that some developers will discount an upgraded app with a new SKU for about a week in the store. This gives existing users a chance to upgrade for less, offers an incentive to new users, and may ultimately drive the app further up the Top 100 lists, further increasing downloads. It might — and that’s a big might — be beneficial all around.