The Cost of Building an iPad App

Ever wondered how much it costs to build an iPad app? Thinking about developing your own app?

The revenue generated by some apps in the App Store is impressive, but only a small percentage of apps actually make enough money to cover their costs. Before taking a home equity loan or asking your family for money, and before investing tens of thousands of dollars in your idea, the following guide may give you a better idea about how much time and money your app will require.

Typical app costs

Regardless of who actually develops the app, let’s look at what it takes to build it. An iPhone or iPad app typically takes anywhere between 2 weeks to several months to build, depending on the complexity. Building an app is not just about coding, as it requires:

  • Design: Unless you have the proper skills to do the design yourself, design will cost you money, especially for more advanced apps. Expect weeks of work to build all the app screens, and this job cannot be off-shored. At $50 to $150 an hour, U.S. based designers will likely bill you anywhere between a couple thousands of dollars for a basic app, to several dozens of thousands of dollars if you’re building a higher-end app that requires many screens to be designed.
  • Coding: Similarly, writing the app’s code will usually take several weeks to several months of work. This work can be off-shored, and several outlets in Europe and Asia do this job for a living. If you decide to off-shore, you will likely save some money, however, keep in mind that off-shoring requires a lot of coordination, as you will have to manage teams that may not speak the same language, work different hours, and have hundreds of customers like you to deal with. A U.S. based team will likely cost you more, but these teams are local and are usually a lot easier to deal with.
  • Testing: Nobody wants bad reviews in the App Store. In other words, you will need to spend days playing with your app, trying to identify bugs and find out what could go wrong. Again, depending on the complexity of the app, this job could take one person a couple days, or five people two weeks. Expect a lot of “back and forth” between the testing and development teams, in order to get rid of all bugs identified within the app.
  • Infrastructure: Unless your app does not require any interaction with external servers, keep in mind that server development and infrastructure is critical for the app to succeed, as a slow server response and/or overloaded server will likely lead to bad reviews and poor sales, even if the app is great. Don’t be shy and expect to invest a lot of money on the server side of the equation, especially if you expect your app to be wildly successful. Good infrastructures do not come cheap, and keep in mind that recurring monthly fees will have a direct impact on your revenue.
  • Validation: When you are ready to launch, the last gate is the validation. Passing the validation could take anywhere from a couple of days to several weeks, depending on the app and depending on the number of Apple guidelines your app may be infringing.
  • Project Management: The more third parties involved, the bigger your headache!

For a nice but simple app, the design work will likely take a designer about a week, which will cost you about $6,000. The server side will likely require a developer about 2 weeks of work, or about $12,000. Similarly, the app could be written in about 2 weeks as well, another $12,000. Add $5,000 for project management, hosting fees for a year, debugging, unforeseen delays, and your total budget is around $35,000.

For a nice high end app, like a high-end game, numbers are usually much higher. Design will likely cost you $30,000 alone. Development will be in the $150,000+ range. Hosting fees and extras will cost another $30,000. At the end of the day, your app will likely cost you at least $200,000.

Now, if you happen to be a great designer and a skilled developer willing to spend weeks on your own app, the cost could be very close to $0…

A couple examples

Twitterific

Twitterific, the most popular twitter app in the App Store, was solely built with sweat equity. Craig Hockenberry, the man behind Twitterific, recently revealed how much work was required to build the app: about 1,100 hours. At $150/hour, Twitterific for iPad costs about $165,000 for the code only (the iPad app also used existing code valued at roughly $20,000). On top of that, the design phase cost was about $34,000. Finally, project management, testing, and other costs were around $16,000.

When you add all these numbers together, the cost to build Twitterific is around $250,000 – note that this app does not even use a backend support system, which would have likely doubled the development costs.

Twiterrific

FLUD and other news readers

FLUD, the popular news reader, was also built mostly via sweat equity. Compared to the competition, the team behind FLUD is very lean, as just like Twitterific, only two coders are behind the app. To put things in perspective, Flipboard has $13 million invested and 16 people, and Pulse News has a full-time staff of 5. FLUD has 2 coders.

The developers didn’t give much details about the cost of their app, but given the number of hours put into the app, the app would have likely cost at least $200,000, if the folks behind FLUD would have used a third party to build it.

The app costs $4 and sold about 20,000 copies to this day, so the gross revenue for FLUD is around $80,000. Nice if you do the work yourself, not so much if you pay someone to do it.

FLUD

Cut the rope

On the other end of the spectrum, the large game producer Chillingo recently launched the wildly successful Cut The Rope, and sold 1 million copies in less than 10 days. The iPhone version costs $1, while the iPad version costs $2, so the revenues generated by the app so far are somewhere between $1 million, and $2 million. If the app becomes as successful as other smash hits like Angry Birds, it will likely generate 5 times more revenue over its lifetime.

Chillingo does not typically develop its apps directly, and uses third party game studios. In this case, the UK-based company worked with Russia-based Zeptolab to build the game. The cost to put the app together is not public knowledge, but likely in the $200,000~$500,000 range. It is also likely that Chillingo and Zeptolab have some kind of revenue sharing agreement, but still, the game should already be profitable for both firms.

Cut The Rope

A few words of wisdom

  • Ask yourself these basics questions: Is the concept new? If not, is it vastly better than what’s currently available in the App Store? How will the app be marketed? What price points? Paid app? Free app with in-app purchases? Or a totally free app? Who will design and develop the app?
  • If you have a great idea, and happen to be a developer, sweat equity is the way to go, as the costs to sub-contract an app is high, even for low-end apps.
  • If you are unable to code, and decide to use third parties, expect to spend at least $35,000 on your app. If you have high expectations for your app, expect to triple that cost, easily. Also keep in mind that only a small percentage of apps in the App Store generate revenues of at least $35,000.
  • Do not forget that Apple keeps 30% of your revenues! Similarly, Uncle Sam will want his cut at the end of the year as well.

Building an app can be a fun journey for many, especially for the folks who have coding and design skills. For others, it can quickly become a financial nightmare. One simple advice: sharpen your pencils and build a realistic business case before you start pumping money and/or sweat equity into your app, to help you take an educated leap of faith.

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About dag: Certified geek

  • http://www.sebastianhahn.de Sebastian

    Great insights, thanks for such open words.

  • BOB

    I see you guys have censored over three comments to this posting. A bit Orwellian aren’t you? Or maybe your ego is a bit large?

    • http://www.padgadget.com dag

      No censorship. Multiple comments were sent from the same IP with multiple user names, and were consequently identified as spam.

  • xiaoa

    If possible, dont miss a ipad! ipad is so fantastic!now ,i am a ipad user , i use my ipad playing games, whach movies, sending e-mail ect. i maily use my ipad to enjoy movies, as i am a movie fan, i purchase a ipad chair and Aneesoft ipad video converter , i watch videos everyday and i never go to the cinema , at the same time, ipad as a tool of Mobile Office is also Applied and fashion for many enterprises , in a word, ipad are more and more applied by us in life .

  • xiaoa

    If possible, don’t miss an iPad! ipad is so fantastic!now ,i am a ipad user , i use my ipad playing games, whach movies, sending e-mail ect. i maily use my ipad to enjoy movies, as i am a movie fan, i purchase a ipad chair and Aneesoft ipad video converter , i watch videos everyday and i never go to the cinema , at the same time, ipad as a tool of Mobile Office is also Applied and fashion for many enterprises , in a word, ipad are more and more applied by us in life .

  • Angrybird

    I need to find 35 Gs…

  • http://blog.binaryfinery.com Jamie B

    You provide three examples, all of which cost in the realm of $200k. Yet you say the budget should be $35k?

    Perhaps you can give some examples of apps that cost $35k so we can get an idea of the difference.

  • Matthew Frederick

    The range is wide due to a ton of variables. When a potential client asks, “How much does it cost to build an app,” I note that it’s much like asking, “How much does it cost to build a house?”

    That said, I’m curious about the $35k apps as well.

  • http://www.namics.com Felix Widmaier

    Thanks for this overview!
    Considerng the design part iterations and design production are missing! In one week a good designer is able to design a simple but good app based on the clients briefing.

    But I’ve never ever experienced a project where the first design was implemented without any iterations. Between 15 and 75 (!) Percent of the initial development efforts have to be considered from my experience. The bigger the clients company the more iteration efforts.

    And finally the design has to be prepared for technical implementation (and, in some cases documented for later usage). This might take another 1 to 3 days.

  • http://vectorbloom.com Elizabeth Boylan

    My business partner and I were breaking down this article. I think the design and development process is well laid out, but it seems like everyone involved is earning the same hourly rate of $150.00??? There are the costs of maintaining the app and updating code which aren’t included in the article above.
    Nevertheless, in our experience it took about 1.5 months to build and test our last custom app which incorporates an open source calendar and registers local notifications from Birthdays entered in the user’s contacts. The client prepared all the artwork.
    As a solution for the client to increase their presence on the App Store, I reformatted the original app’s code so that the client could reuse a ‘template app’ that didn’t include the Calendar and Local Notification’s code so that new artwork could be used for Seasonal releases of separate apps. The process of modifying the original app took about 8-10 hours as well as training the client on saving new artwork to the project folder for handling multiple distribution builds. We called these clone apps. Incidentally, Cartolina’s Original iPhone App was featured by Mashable as the Number 1 E-card App and Cartolina just released their Holidays App which is beautiful! You can learn more about Cartolina’s iPhone app development strategy at John Borchert’s new blog:
    http://johnborchert.com/2010/11/23/cartolina/
    @johnborchert is available for custom iOS consulting.

  • http://twitter.com/1cloudspace Cloud World

    Angry birds cost $150,000 to make. They made $72 million dollars on the game last year. Thats why games are so popular for designers. It is worth the risk. And you always learn something new…

  • Gingerfoxed

    How would you be able to earn all that money? By the way, I seriously doubt that it takes
    $ 30,000 to develop an app. I heard that college students charge around the $500-1000 range (thanks to my friends. MollyMouse- you are so right.) If a developer did charge that much, he would be greedy and corrupt. Seriously.
    Most of the top apps-like Angry Birds have greedy developers. I mean, Angry Birds sold all their costumers private information for money. They have downright annoying ads in their PAID apps that already cost a lot compared to other apps. And then they say they support costumers. Heck- they earn $12-14 million!
    To create a truly amazing app, all you need is a knowledge of programming/developing (hit the books!), a iMac and a group of testers with iPods, iPads and iPhones. Oh.. and an AWESOME idea. It should be moderately expensive (we’re talking about a 1,000-2,000 bucks to start), so it’s worth it to make your own app.
    But, be sure to make a TRULY AMAZING app that IS NOT CHEAP OR CORRUPT.

  • Tommyb

    You obviously couldn’t care less for professional level design. If you want crap, hire a high school or college level intern – but if you want pro work, hire a pro and pay appropriately. We (highly experienced) designers take many years to develop high end skills and are worth every penny of $50-$150 an hour. 

    • http://www.facebook.com/profile.php?id=1675094367 Janusz Krawiec

      good point… If someone tries to compare a years of professional experience to student’s experience… well… I guess the comment is needless…

      • http://profiles.google.com/dlwnine Bob Meister

        sad truth is you end up paying the ‘professionals’ who end up contracting out their design to students or worse.

      • http://www.facebook.com/singhmck Sudeep Singh

        That’s right.

  • http://twitter.com/CSPrestonInc Brett Miller

    The very minimum price for building a simple mobile app is around $3,000.  Speak with a professional developer about your specific project to find out the real cost based on your unique requirements…

    I actually know many talented (and affordable) mobile developers (freelancers and agencies). I’d be happy to provide an introduction. 

    Thanks,

    Brett
    http://www.customsoftwarebypreston.com
    dev@cspreston.com

  • http://profiles.google.com/dlwnine Bob Meister

    I also heard the Giants won the Super Bowl… I think I’ll buy a football team now because i heard there’s easy money just waiting on me!

  • http://profile.yahoo.com/VJD32KYRHQT4PTZ5SKZ3M5WTYE H Jackson

    For those saying that college kids have no talent and make horrific apps -… Who do you think made Facebook? … and Google? – Both started from college kids you morons.
    You “professional” designers may have great talents, and there are corporations who are able to pay that much for their apps but you do no favors for the start ups out there.
    Price has nothing to do with quality. Character and talent create quality. There are a million apps out there that are terrible from people who charge this much. In fact, I’m not impressed with 99% of your work so get off of your high horse.

  • http://www.facebook.com/singhmck Sudeep Singh

    ha ha, well said! :) Even if it is outsourced to cheaper locations like India, the rate/ hour for an experienced developer/ company would be $ 20…lesser than that and you are hiring rookies!

  • Nattipoo

    I’m an analyst / programmer. Woot woot :) I can safely say that professionals r not always good at their jobs so allow testing and bug fixes to blow out ur budget.

  • http://www.facebook.com/people/Serendipity-Seraph/100000693617592 Serendipity Seraph

    After having built software for a living for 30 years I do have an idea. Anyone that would charge the above prices is either incompetent or used to fat government contracts. The truth is somewhere in the middle but closer to the low end quote that the high end.

  • http://twitter.com/michaelmd michaelmd

    you forgot to mention developer fees abd the need for a brand new mac just to use Apple’s sdk .. that already puts it out of reach!

  • Ashley Cook

    Is there such a thing in letting the app pay for itself? Like can i jump straight to development with no cash down then once app is up an running programers take their 5 – 10 per cent share?

  • Agicent Technologies

    A good thread on the iOS App development quote part can be read here, it gives a big spread categorically that what type of App should cost how much, give it a read – http://www.quora.com/How-much-does-it-cost-to-build-an-iPhone-app/answer/Sudeep-Bhatnagar?__snids__=228264021&__nsrc__=1

  • Marleah Stout

    Thanks for posting this article