How Much Does AI App Development Cost? Factors You Should Consider

Artificial intelligence has the power to broaden the outlook of technology for today’s people and professionals. AI is now integrated with websites and apps to create high-performance and very useful apps that act as assistants to users. The technology of AI has become the pioneer of novel technologies in 2024. The creation of AI apps and websites has the scope of creating more revenue for software development companies.

For instance, the development of generative AI products has the ability to bring in $280 billion in revenue as new software product revenue. It is no wonder that all the leading software development companies and startups are trying to offer AI-enabled features to their users.

Today, nearly 77 percent of users like to use AI-enabled services from mobile apps and websites. On the other hand, nearly 84 percent of organizations believe that AI app development is required to gain a competitive edge over other companies in the market.

Why should you invest in AI App Development in 2024?

The potential of artificial intelligence technology in bringing more growth to the global economy and getting high profits for software development companies is a reason why professionals in the app development scenario want to invest in AI app development and AI tech innovations.

The AI technology features have the potential of generating $15.7 trillion to increase the pace of global economic growth

The growth of the cross-platform app development sector enabled by AI is going to double over the next few years. Therefore, it is important for a mobile app development company not to miss the opportunity to bring in extra revenue and expansion for the company. This is the primary reason there are so many investors interested in AI app development. They evaluate companies offering affordable AI development services and then decide to meet the Average cost of AI software development.

What fascinates investors is the potential that Gen AI brings to the table for mobile apps and websites. A lot of potential for AI is yet to be explored, and this can be realized with more investments that fuel research and development.

AI App Development Cost Factors to Keep in Mind

There are a number of factors affecting AI app development cost, and these factors can greatly influence the AI app development pace and sector. These factors need to be in your mind before you decide to hire an expert AI developer for your company.

AI App Development Cost Factors to Keep in Mind

1. Different Types of AI Apps

When it comes to AI app development, there are a number of apps that can integrate with this capability. Generative AI and other sectors can be used very innovatively to enable AI features in different kinds of apps that cater to different industrial sectors.

For example, AI can be integrated into productivity assistant apps; the technology can also be used to create chatbots for retail and fintech apps, and AI-enabled algorithms can also help create highly accurate health and fitness apps. The level of investment and the kind of AI app development company depends on the envisioned app product of the project.

2. Platform Choice

The platforms on which the AI app will be launched and used also contribute to determining the AI app development cost breakdown. You can easily do cross-platform software development for different kinds of AI-enabled apps. Depending on the platforms, the cost of development will come up.

For example, if you are only developing for Android, the app development cost will go from $10,000 to $50,000. However, the cost of AI app development for cross-platform capabilities can go from $30,000 to $250,000 USD.

3. Scale and Complexity

The app complexity and the scope of the project also determine the cost of AI app development. If the app is very complex and advanced, the cost will go to the higher side of the limit. However, with a broad scope of the project, the reach and revenue, as well as the subsequent ROI, will be higher.

4. Tools and Tech

The cost of the AI app development process also depends on the technology and suite of tools that will go into the app creation. The development team has to work with some tools to create the app’s infrastructure and features. The use of paid and advanced tools will increase the cost of development for the mobile app development company.

5. AI-powered Features and Capabilities

AI can be used to create and integrate different types of features in an app. A basic AI app will have some AI features that are limited in scope. However, when the AI features are adapted to make more revenue and offer new features to the users, the cost shoots up for the entire development project.

6. Data Infrastructure and Database

The data infrastructure and database of the app that supports the development of the app and its features will also cost integration into the framework. The type of database and the complexity of the infrastructure also contribute to the determination of the app development cost.

7. Development Team Strength

The development team of the AI app will also contribute to the investment needed to cover the average cost of AI software development. The time taken for development and the length for which the development team is engaged in the project also determine the cost. It is important to hire for quality of service and not just for the number of developers.

8. Geographical Base of the Team

The cost of development for an AI-enabled app also depends on how you operate it. If you are collaborating with an outsourced development team in a geographical location where the labor costs are very low, then you can save money on the investments made. If you plan to pursue app development through a native, in-house development team, the maintenance cost will be higher than that of outsourcing.

A Strategic Breakdown of AI App Development Costs

Before you invest in AI app development, you need to know about the cost breakdown for the AI app so that you can do AI app development budget planning. The different steps of AI app development determine the resources and money invested in it. For every step, you need to see how much the development and consulting team charges.

A Strategic Breakdown of AI App Development Costs

1. Initial Strategic Planning

Before starting the actual development process, the app development team has to meet with the client team and discuss the idea behind the app. The product development process will only be a success when the development team is clear about the idea and shares the vision of the client.

The team has to understand the expectations and scope of the project before investing in its development. The initial meetings are all for planning and strategic discussions so the two teams can be on the same page. The cost of initial planning and strategy development can be from $5000 to $15,000.

2. The Design Phase

The next step of the AI app development process is to start creating the app’s design. The design of the app is what gives the idea its body. Professional App and UX designers take up the design process so that the app can have its layout and features on the wireframe.

The app development team creates a visual prototype of the app so that it knows about the features that will be integrated and the infrastructure needed to support it. The design creates points of response for the actual app. The design phase costs can amount to up to $50,000, depending on the scope of the app.

3. Core Back-end Development

Once the client end and the external features are developed, the AI developers work on the back end to create a core infrastructure of the app. The app infrastructure needs to be secure, so the app development team creates the app infrastructure with special attention paid to security layers and firewalls.

The app development team works thoroughly to integrate functionality into the features of the app so that the final product meets the standards set in the beginning. The backend development phase for an advanced AI app can go up to $50,000 or more. The average cost of API integration can amount to $10,000.

4. Quality Assurance Cycles

The app testing phase also adds up to the total development cost for the AI-enabled app. Once the app is over the finish line, the app product is ready for QA checks. Professional app testers focus on creating test cases that will test the features, security levels, and functionalities of the app. The testing team carries out usability tests, performance tests, regression tests, integration tests, and unit tests to check every aspect of the app for any kind of error or discrepancy.

Hiring an app testing team and running multiple test cycles on the app product adds to the cost. The cost to test an AI app thoroughly can go from $10,000 to $25,000.

5. Launch and Post-launch

Once the tests and improvements are done on an AI app, it is time to deploy the app in the market. The development team follows some steps to deploy the app for use among the audience. It introduces the app and also creates processes to launch in a phase-by-phase manner so that the app can be integrated into the market and is accepted by the audience very quickly. Proper deployment and then post-launch maintenance can make the app a favorite among users and can achieve all the goals of the app-owning company.

There are many development companies that sustain their partnership and offer post-launch maintenance services to their clients for troubleshooting and technical support. As a result, the app’s performance is well maintained and meets audience expectations. The deployment phase costs can be $15,000, while the cost of post-launch support services can go up to $20,000 depending on the frequency and kind of problems that come up.

AI App Development Costs across Different Industrial Verticals

Now that you know about the factors affecting AI app development cost, you can then venture into the cost of app development depending on the industry segments. The kind and level of AI-enabled features that one needs depend on the industry for which it is developed.

For example, the healthcare sector and fintech sectors are very sensitive and crucial. Therefore, the cost of app development for such sectors is higher than for other sectors.

When we peek at the use cases of AI apps for which they are created and used, the cost varies. For example, in the manufacturing sector, AI apps are used to automate machines and increase productivity. The cost of development for such apps in this kind of setup goes to $45,000 or more.

When the sector is healthcare, the development cost for AI apps is similarly high. Patients and doctors often look at AI apps as personal virtual assistants in the healthcare sector. The cost of AI app development for the insurance sector is lower, at $35,000 or more.

The lowest costs of app development sector-wise are for real estate, where you can get an AI-enabled app for $18,000 or more. In the retail and supply chain management sector, the cost of AI app development can go from $20,000 to $25,000.

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Additional Costs to bear in AI app development

Apart from the obvious costs of development for AI-enabled apps, there are some miscellaneous costs and app investments that an app development team has to do to float an AI-enabled app. Here is a brief look into the additional costs that a development team has to pay for.

Additional Costs to bear in AI app development

1. Licenses and Tool costs

When undertaking an AI app development project, it is important for the app development team to take up licenses and subscriptions to development tools and app runtime environments. Some of these tools might be free, but most of the tools needed for the professional development of AI apps can be very highly priced. For example, there are some tools like Tensorflow and PyTorch that need additional licensing.

You need tools like Decube that will help in AI and ML implementation. This process, with the help of tools, reduces the time needed for development and also boosts productivity. So, the additional costs spent on licensing and tool subscriptions are worth it. The cost of licensing can be from $100 to $1000, depending on what the development team uses.

2. AI Model Training

When an app is built over an AI model, the AI model needs to be put through training runs. The cost of a training run for a small AI app can be as low as $930. However, there are apps and AI Models that can cost very high for training and documentation.

For a basic app, the cost can go from $1000 to $10,000. The documentation process needs to be thorough so the funds you invest are worth it and contribute to the future run of the app.

3. Security Layers and Compliance Costs

The cost of app development rises when we add up the cost of maintaining compliance with AI tech software. AI is a tricky technology that mimics humans, which is why there are security risks and concerns already.

AI developers have to meet compliance standards strictly to ensure that the AI model they create is not a threat to the larger purpose of humanity. The development of an AI app should be like an intelligent assistant, not like a potential threat. To ensure that the app meets all the regulatory standards, the app developers need to invest in security firewall development. The cost of compliance can go as high as $344,000 for some of the AI apps and AI app development companies.

How to Save Money during AI App Development

It is important to invest a large chunk of money in AI app development in order to create an app that is actually useful and meets all the industry standards. However, there are also some strategies that you can use to save money while pursuing AI app development for your company. These strategies will improve the pace of development and be very money-efficient in the future.

How to Save Money during AI App Development

1. Priority Feature Selection

The first approach is to start with an MVP for the market. You should look at the MVP model planned in the initial phase and choose the features that are needed on a priority basis. You need to pick features that will first create a basic and useful model for the audience.

The development of an MVP with the most necessary features and functionalities can increase the pace of development and cut the time to launch the app. In this way, the initial costs of development can be reduced. Moreover, in the next cycles, your company can add more features and upgrade the app to an advanced version using the initial profits that come from the MVP launch.

2. Using pre-built Modules for AI

You should also look at the pre-built AI models and AI services API to integrate AI capabilities into your app. If you already have a business app that represents your company, taking up full-fledged AI app development does not make complete sense. A much more economical approach is to create new features with pre-built AI models that your team can easily train. API integration costs are only a fraction of complete app development costs.

3. The Scope of Cross-platform App Development

While cross-platform app development costs might be higher than basic native app development, it is also the approach that makes an app with broad scope. You can take up cross-platform app development with the help of a mobile app development company and then launch the AI app on multiple platforms. This can save you money in the long run and recover the development costs as it targets a wider audience. With more downloads and user engagement, you can make the AI app development project highly successful with high ROI.

4. An Affordable and Reliable Development Company

The importance of the development partner in an outsourced AI development project is very high. You need to pick the right app development company for the project in order to make the app a success. It is important to pick a development company that will deliver high-value app products within your budget.

Look for a development partner that offers affordable AI app development services and can be flexible according to the investment you are ready to make. Companies with multiple engagement models and an extensive team on hand can help you save money while balancing the app development process.

How Long Does it Take to Build AI App?

Apart from the money you are investing, the time you invest in the development project also matters. In a highly competitive landscape, the time taken to complete the app and launch it should be much less so that you can be ahead of your competitors.

1. Simple AI Apps

Based on the simple framework and basic features of an AI app, the time taken to develop it can be up to 3 months. You can invest in a low-cost and basic AI app if the time to launch is short.

2. Medium Complexity AI Apps

If you are targeting a medium complexity AI app that is ready to be launched and can have a plethora of features, you need to invest around 6 to 9 months for the development process to be complete, with corrections and improvement.

3. Complex AI Apps

The time taken to develop highly complex AI apps that cater to specific niches and are very efficient will be greater as the app needs to be tested again and again. Such an app also goes through multiple test cycles. The detailed concept of such an app takes time to complete and can last from 9 to 12 months.

Conclusion

When you think about investing in an AI app development project, it is important to see that you have to also scope out time and resources for it. The idea and expectations of the project should be very realistic from the beginning. Moreover, you should also spend time in researching about the development company you want to partner with. Know about the tools and human resources needed for the project and choose a good cross-platform app development company that can meet the requirements at a reasonable cost. With proper development and marketing of an AI-enabled app, your company can make steady profits for many years.