[so898]

I think you can just delete the old version from App Store. People who brought your App could still find the old App in their Purchased List.

[shadesandcolour]

I think it would be better to move your older version to free or very discounted, and put up some alerts when they start the app (and before they purchase) telling them about the new version. Tell them how to migrate their data, if they have any. And be on your way.

[nathanstitt]

You can do this, but I'd advise against it. I did this with one of my apps and have received quite a few complaints from people who can no longer find it by searching.

It seems to me that quite a few people don't know about the the Purchased list.

[kybernetyk]

Oh, thanks for the hint. That makes some things easier :)