How Much Does It Cost to Develop IoT Software?

Published: October 31, 2022

12 min read

Last updated: November 8, 2023

Internet of Things implementation has always been quite tricky when it comes to costs. It can involve many different stages within a typical software development cycle like researching connection protocols, or establishing BLE or WiFi connectivity. Each of these “extra” stages adds up to the overall project costs and may be not very clear when you’re just beginning the IoT integration.

However, at the highest level, we can break down a cost structure for IoT integrations in the following categories:

  • Production costs. They consist of the finances required to create an IoT module. Both hardware and factory costs are included in this category.
  • Development costs. These are the most interesting ones for us. They include aspects that are vital for solution delivery, such as fees for creating custom software or researching data protocols like BLE.
  • Operating costs. These costs are the ones that appear when the IoT solution starts to function. For example, finances spent on software licenses and establishing cloud hosting are standing as “operating”.

As our team specializes in IoT mobile app development, in this article we’ll focus on the IoT app development cost in particular.

IoT application development costs significantly depend on the work rates of IoT app developers, IoT platforms and desired connected devices.

IoT devices always require specific mobile applications that prioritize IoT connectivity (image by Lily)

Various IoT solutions require a custom approach and it’s almost impossible to present a precise estimate that may be referred to as a generalized one. The custom approach supposes creating a unique software solution, the uniqueness of which will significantly impact the total cost.


❓ What Influences IoT Development Cost?

IoT app development cost is never fixed as they change under specific circumstances. Let’s take a closer look at aspects that usually influence the costs of delivering an IoT solution.


Targeted platforms

IoT cost will vary depending on the desired platforms for the project. Whatever your business goals are, you pick the most suitable platform among desktop, web, and mobile to build an IoT solution.

We at Stormotion create Internet of Things software with the amazing React Native framework. It gives us an opportunity to deliver products for several platforms (iOS, Android) at the same time lowering Time-to-Market and expenses. This level of efficiency we are able to reach as React Native allows us to reuse different pieces of code for those other platforms.

We recommend starting off with launching your product on one platform, which is preferred by your customers. Later on, you may launch the solution on the other platform, if it becomes necessary.

In turn, React Native makes the development process for both mobile platforms less complicated. Thus, you don’t have to seek assistance from different teams to integrate a new OS, when it all can be done by one 😉

Generally, the IoT capabilities should determine the development services, however, there are not many app developers with such Tech Stack agility for IoT mobile apps.

Development services play crucial role in setting up an IoT ecosystem(image by Tomasz Czyżkowski)

Moreover, React Native allows reusing some parts of the mobile code for web platforms, too! Thus, if you don’t plan on focusing solely on one platform, we’d recommend you consider this framework as the way to cut IoT application development costs without the decrease in quality.

Read also:

React Native vs Native (iOS/Android) App Development Comparison


Software Features

As the quality and quantity of your software’s features considerably impacts the cost to develop an IoT app, we recommend building a clear vision of what is needed and what is desired. In other words, think of starting with an MVP — Minimum Viable Product.

Prioritize the features you'd like to have in your project by dividing them into the vital ones and the ones that aren’t so necessary at the first stage. This will help you to understand how much your project’s core costs and what the cost of further development stages is. This will also help you to cut off all the features that are not that essential at first, decreasing the initial expenses.


UI/UX interfaces

In our opinion, one of the most valuable aspects of IoT software design is user-friendliness. The easier it’s to use the app — the better retention rate you may expect. Depending on the complexity of the design you envision in your project, cost to develop it may significantly differ. We recommend sticking to non-complex and intuitive design decisions in order not to overload the user's experience along with the project’s budget.

We’d like to list several inner aspects that affect development costs and speed up the delivery at the design stages:

  • General practices. It’s quite common to observe the tendencies and decisions that are used among the companies of your segment. If there’s a common design decision found in different companion apps, there’s no need to complicate the development by trying to invent something extraordinary. The main advice if you prioritize lower costs and faster development — stick with simplicity.

  • Responsive design. On one hand, it’s great to predict and adapt your project’s interface to every possible device, however, it may create excessive spendings that aren’t so essential from the start. Our advice is to determine several main devices at the design stage and focus on development, as you can always adapt to new ones in the future when it becomes necessary.

  • Existing libraries/decisions. We recommend implementing more already existing libraries and features to lower your expenditures. If your goal is to make a good product without spending tremendous amounts of money — don’t overlook taking existing design solutions into consideration. It’s always cheaper to give up a few potential features than to design everything from scratch.


🔍 What are the So-Called “Hidden Costs” for IoT Development?

Considering IoT software creation with the help of a Tech Team, you always stick to the numbers provided by the specialists you hire. However, this number doesn’t always include the expenditures on the third-party services that your project requires.

This includes various platforms for managing databases, making cloud computing effective, or gathering statistics. Here are some of them, that you may require in your project development:

  • Firebase. This is a platform that allows you both to build and monitor your future software. Providing you with the tools to synchronize and store your data conveniently, it also ensures a high security level and scalability for your project. Firebase is a unique service that lets you set up your authentication even if you require an Identify Platform implementation. Among all the features for cloud storing and data structuring it also allows you to gather precise statistics and performance monitoring with the help of Google Analytics, Crashlytics, and TestLab.
  • Hygraph. The Federated Content Platform that allows the creation of a unified content layer from any source for further delivery to any required platform. It uses a GraphQL API to set up a unique federation approach to distributing your content from any place to selected platforms. Hygraph also provides you with an easy-to-use content management interface with schematization features to structurize your content in your own way.
  • DigitalOcean. In case you have your own database already set up, you need a platform to deploy it for proper cloud computing and storing features. DigitalOcean is one of such services that provide an easy code deployment along with granting a top-tier security level for your project. Quick API integration is also one of the trump cards of this platform, making adding features to your software less complicated.

There are many examples of third-party services that may come in handy for your IoT project’s success. Every single of them has its monthly/annual cost that shouldn’t be overlooked in your budget estimates.


📉 How to Safely Reduce IoT App Development Cost and Avoid Money Waste?

As the variety of solutions is so vast, it’s hard to determine what you should do to reduce the cost to develop an IoT app. However, we’d like to share some tips that will help you make your development costs сlean of excessive spendings.


Conduct a proper Project Discovery Stage

We recommend you not to underestimate the Discovery Phase in a project’s lifespan. Obviously, conducting the DS costs much less than it may cost you to deal with the consequences of improper planning. If you focus on the prevention and not on the cure, it’ll significantly save your finances, as fixing errors costs way more than thoroughly planning on their prevention.

For a better understanding of what a Project Discovery Stage is, feel free to click the link down below and acquaint yourself with how it’s usually done.

Learn more about an MVP here:

PoC vs MVP vs Prototype

Read also:

Project Discovery: What is it and Why Do You Need it?


Start off your development with an MVP

The most common mistake, that usually leads to increased cost to develop, comes from the desire to deliver the product at its best as soon as possible. However, such desires often become an issue that makes development longer and even more complicated. We recommend starting off with creating an MVP that can be easily modified and tested, before proceeding to the final product creation.

If you want to avoid money waste, mobile app development supposes initial MVP creation, especially when it comes to building bridges between IoT industry and mobile devices.

IoT mobile apps are much cheaper to properly link with connected devices when you conduct an MVP-building stage (image by Julian 🎨)

Throughout the project’s life cycle there’s a place for various adjustments that are much cheaper and faster to implement in MVP than to remake a full-fledged software. Not to mention extra costs spent on handling issues and challenges that may appear through the development. Exactly the MVP stage allows you not to start over the development, thus, letting you avoid unnecessary expenditures and gather more feedback.

Read also:

How Much Does It Cost To Build An MVP: MVP Costs Explained


Provide early Quality Assurance

The greatest combo for making the cost to develop IoT based apps significantly lower is providing QA in the early stages of your MVP, particularly when testing IoT prototypes. The later you provide Quality Assurance for your product, the bigger risks are to encounter bugs and unexpected challenges at the further development stages.

On the contrary, early QA allows to foresee and prevent a great number of such issues that could drastically slow progress and hit with excessive financial expenditures.


Initial cross-platform development

As we’ve already mentioned in previous sections, it’s crucial to understand what platforms you are targeting first. Basically, the more platforms you need to cover, the higher development costs you should expect. However, in case you’ve already determined beforehand that you’re going for more than one of them — there’s a way to reduce the costs.

It’s true, that IoT applications are less expensive to eventually adapt to another platform, however, there are solutions allowing the cross-platform development of IoT apps

Some languages, such as React Native, allow a cross-platform mobile app development for your IoT technology (image by Lily)

In fact, considering initial cross-platform development allows you not only to reduce the development costs, but also significantly lower the costs to maintain and modify software for your project. We recommend you to find a team that specializes in software development with the use of certain Tech Stack. For example, if your goal is to create a companion app for both iOS and Android, React Native developers are the best partners for you. As it allows to create a common codebase for both platforms, making the development and maintenance much easier.


🔑 Our Expertise in Determining Development Costs for IoT

When planning out your IoT application development cost, it’s important to make sure that your budget is enough. But while the exact numbers can’t be predicted since each case is unique, there are a couple of core features that you and your development team should consider during your calculations.

As a IoT mobile app development company, we can share our vision of core parts of an IoT app development cycle and how much time is required for their implementation:

⚙️ Feature

📖 Description

⏳ Min Hours / Cost

⏱ Max Hours / Cost

🔎 Research of Data Protocol

Researching the best match in terms of data protocol for your tech & business needs

15 hr / $900

25 hr / $1500

📲 IoT Device Connection

Establishing a connection between a module and a smartphone via BLE or Serial Data

120 hr / $7200

180 hr / $10800

⚙️ Reverse Engineering

In case the protocol description is not 100% accurate

40 hr / $2400

60 hr / $3600

📚 Collection

Collecting essential data from the device

24 hr / $1440

60 hr / $3600

🔄 Processing

Processing and structuring collected data from the device

48 hr / $2880

64 hr / $3840

💼 Storing

Setting up or finding a storage for all the data we process

32 hr / $1920

40 hr / $2400

📊 Visualization

Creating a convenient way for structured data presentation

60 hr / $3600

100 hr / $6000

💻 IoT Multiple Device Management

Establishing a multiple connections for devices (if needed)

20 hr / $1200

60 hr / $3600

🛠 Quality assurance

Catching all the unforeseen bugs

40 hr / $2400

60 hr / $3600

As it comes from the table above, approximate IoT mobile app development time (core functionality, to be more specific) varies from 400 to 650 hours. Given an average charge rate of $40-60 per hour, we managed to estimate the highest possible costs for every development stage. Keep in mind that our estimates are based on the experience we had working among the Central and Eastern European companies. However, the rates for delivering the product of the same quality will probably be higher if your development partner is from Western European and North American regions.

Generally, it depends on the number of desired features and the complexity of a project. However, regardless of the complexity, we at Stormotion love being partners in crime for developing IoT based mobile apps, as it’s always a unique and unforgettable experience.

Get a detailed estimate of your Project by the Stormotion Team!

Contact Us

There is another thing we may recommend from our expertise. To save your time and budget, always send your device to the team you hire for an IoT application development. We at Stromotion worked on creating a companion app for an IoT system when the developer didn’t manage to deliver an IoT module to our office. As a result, our team had to spend more than 50 extra hours on the development, establishing the best connectivity level without the device being physically present. Thus, extra time wasted on the development also turned into excessive expenditures according to our charge rates from that period.

On the other hand, our latest project Norsk Guardian is an example of IoT application development, when we had the device in our office before the project started. Norsk Lithium develops batteries for outdoor activities such as open water fishing, ice fishing, and camping. They also are of a great use as accumulators and portable chargers for your accessoires. 7 people from Stormotion Team were involved and managed to deliver a full-fledged IoT app in about 30 weeks of work.

Norsk app

Provide your Tech Partner with devices they develop software for — it will help with testing and QA (shots from the Norsk app)

The biggest time-saver for this project was obviously the fact that we had those boat batteries present in our office. This allowed us to spend less time on connectivity and testing stages, along with making it less damaging for Norsk Lithium’s budget for this project. Eventually, the Norsk app is now on the showcase of Stormotion’s successful IoT projects, having provided both quality design and usability for Norsk’s customers.


💡 Takeaways

To sum up, development costs for IoT projects are hard to make precise in general. The more ideas and features you want in your product, the higher expenditures you should expect.

Many factors from targeted platforms to interface design impact the final costs, so it depends on your priorities. If you aim to create full-fledged software with every single feature that you could think of along with an outstanding design, get ready to spend a lot. On the other hand, if your priorities are the development speed and minimalistic design with the core functionality, the development will cost significantly lower.

"If you have any questions or need assistance from an IoT software development company in creating quality software for your IoT solution, let us know. We will be happy to help you meet your business needs with an outstanding product!

Let Us Estimate your Project!

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