AI in app development is essential for improving operational efficiency for businesses aiming to stay ahead in the fast-paced digital world. However, before developing AI applications, you must consider one pressing question: what will it cost you? 

The financial commitments involved in developing AI applications can be very steep, and that is why a proper understanding is important for both startups and big enterprises. As we proceed with this blog, we will break down the costs associated with developing AI applications and provide insights to help you budget effectively for your projects.

The Cost Breakdown of AI App Development

The cost of developing AI applications varies depending on a variety of factors. The project’s scale, needs, scope, and other factors, which we will discuss later, could influence the overall cost.

Complexity of the AI Model

The AI application’s model is important for its development because it is responsible for processing data, providing intelligent responses to users, and making complex decisions. The complexity of the model you are using will determine the application development costs. 

So, suppose you are to develop a simple chatbot requiring basic natural language processing (NLP) capabilities. In that case, the costs will be lower than those of advanced AI analytics tools, which would require more advanced machine learning algorithms to be developed.

Deep learning models are even more expensive, requiring ongoing learning and adaptation. The amount of data and computing power they need for development also adds to the overall cost.

Level of Expertise Required

The development team you appoint to oversee your project can impact the cost. Hiring professional AI developers who are skilled in various areas of AI development, such as machine learning, neural networks, and data science, will likely require a higher rate than aspiring developers.

If you are considering hiring a development agency, you must weigh the associated costs and expenses. Specialized agencies might be expensive, but the skills, expertise, and knowledge they provide for your project development are unmatched.

Infrastructure and Tools

The cost of the infrastructure you use during application development can be a determining factor. Robust infrastructure, such as servers, software tools, or cloud computing resources, is expensive to afford, especially if your app requires high-performance computing or real-time data processing. 

Time Frame for Development

The duration of your app project can impact your budget. If your project has a tight deadline, you might want to invest more resources for faster execution, which can increase costs. On the other hand, a more flexible timeline might allow for cost savings through iterative development and more thorough testing.

How Much Will It Cost You to Develop an AI App?

Creating an AI app involves multiple stages, each with distinct costs. These stages include initial research, development, system integration, and ongoing maintenance.

Initial Research and Planning 

The initial AI application development phase involves market research, feature planning, wireframing, and basic prototypes. At this stage, you also need to collect data to train the AI model, which can be quite expensive depending on the amount of data.

Requirements such as data sources and licensing fees can also affect the cost of data acquisition. Typically, depending on the project’s complexity, you could spend between $5,000 and $50,000 for this phase.

Development and System Integration

The complexity of the app model, its computing power, and the required expertise needed will determine the costs of this next phase. Generally, the development cost should fall between $5,000 and $10,000.

After that, the next phase requires you to integrate the AI app with other existing software. Should you require any alterations, your expenses may increase. This integration stage could add an extra $8,000 to $10,000 or more to the budget. 

Deploying the app often involves cloud infrastructure, which, depending on the provider, costs between $500 and $700 monthly.

Ongoing Maintenance

After launch, you should consider the costs involved in ongoing maintenance, such as bug fixes, updates, and data monitoring. 

As your app interacts with users, it needs monitoring to identify lapses and provide improvements. These costs typically comprise 15-20% of the initial development budget. 

How to Budget for Your AI Development Projects

Budgeting for AI development projects is a critical step, given the potential costs. Here are some strategies to ensure you’re financially prepared:

Clearly Define your Project Scope

When initiating a project, it’s crucial to pinpoint the challenges your AI application aims to address. You also need to know the specific features and functionalities that your app will must and highlight the expected outcome. 

Clearly defining your project scope will help ensure you have a precise cost estimate and prevent scope creep, where your project gradually becomes more complex and expensive than initially planned.

Prioritize Feature

The features of your app hold significant importance, but it’s crucial to understand that not all features are equally valuable. Carefully identify and select the essential features that are currently important for your app, as well as those that you can add later.

We refer to this approach as the minimum viable product strategy. It allows you to first develop a product’s core functionalities, get it to market faster, and help you control costs.

Allocate Funds for Post-Launch Costs

Your budget estimate should be higher than the product launch. You need to create a budget for post-launch activities that your app might require. These could involve upgrades, maintenance, bug fixes, and other important requirements. For example, you might need to upgrade older application versions to the newer and updated ones on the market, which would incur costs. 

Additionally, when collecting new data, your AI may require retraining. You might need to hire the services of experts to train AI models, which would add costs. This is intended to allow it to perform optimally and provide accurate results. So, having a budget for future costs is also important. 

Consider Outsourcing

Outsourcing your AI app development could be a cost-effective solution. You can get specialized experts to handle parts of the development process, often at a lower cost. They provide the necessary tools for the development stage and allow you to tap into their wealth of knowledge. This will also help save you time to focus on more strategic phases of your project development.

Leverage Existing AI Tools and Platforms

Building an AI app from scratch can be expensive, so it’s important to consider using existing AI tools and platforms. You can leverage the services of cloud providers who offer pre-built AI services, such as natural language processing and image recognition. 

Integrating these pre-developed tools into your app can save you time and money, eliminating the need to develop these capabilities from the ground up.

How We Can Help

North South Tech puts AI app development within reach. We streamline the process, from early planning to post-launch maintenance, ensuring that your budget matches your goal. Our developers provide customized AI solutions, whether you require a simple chatbot or a sophisticated analytics tool. We’re skilled in integrating existing AI platforms to reduce expenses while maintaining quality.

North South Tech stands out for its upfront pricing and flexible development deadlines. We collaborate with you to prioritize features, resulting in a minimum viable product that fits your primary requirements while allowing for future expansion. Our methodology helps you cut expenses and shorten your time to market.

Ready to make your AI app idea a reality? Let’s discuss how to implement your idea within your budget. To begin your AI journey, contact North South Tech now.