The Cost Of Mobile App Development: Is It Worth It?

Candy Crush creator, King, took its successful game from PC to mobile and has seen astounding success.

“King’s focus on the multi-billion dollar mobile games market – creating short, addictive puzzles for the fastest-growing part of the gaming industry – has helped it reap profits rare in its field. Though the company does not publish numbers, industry experts have estimated its revenues at $1 million-$3 million a day. Media reports now talk about an IPO valuation of $5 billion after a source recently said the company had filed to go public in the United States.” (Mia Shanley, Reuters)

With other successes, such as Angry Birds and Fruit Ninja, more and more people are getting the itch to create the next hit in the hopes of becoming one of the Top 10.

However, these highly successful apps are more the exception than the rule, with hundreds or thousands of other apps never seeing the light of day and getting relegated to the back pages of app stores. It has been found that more people defer to their friends’ judgment when it comes to app selection.

People are less inclined to browse app stores to find the application they need. This decreases the exposure of other apps. There is said to be an approximate 0.01% that an app will experience success, leaving the remaining apps in the dust.

Developers still stand a chance at success but that chance is slim. A lot of developers know this because they tried – and failed, at least in the beginning. Here are some numbers taken from David Barnard’s experience creating an iPhone app, as reported by Newsweek:

“…in 2008 he borrowed $24,000 from his parents, set up a company, and built Trip Cubby, which logs driving miles and expenses for harried business people. The application garnered top-shelf reviews, a spot on Apple’s “What’s Hot” list, and earned Barnard more than $45,000 in revenue in less than three months. Then came the expenses: $29,000 for programmers, $15,000 living costs, $14,000 to Apple, $7,000 for marketing, $5,000 for legal and administrative services, $4,000 for logo and Web-site art, and $1,800 in loan repayment. By the time he was done, Barnard says, he was several thousand dollars in the red. ‘My wife and I ended up selling our car to get by,’ he says. Today, Barnard’s follow-up app, Gas Cubby, which tracks fuel economy, is one of the most popular utility programs in the store, helping him earn more than $200,000 to date. ‘But we spent a hell of a lot of money to get there,’ he says. *(Editor’s Note: $200,000 reflects Barnard’s gross revenue, not including expenses that totaled ‘way more than 50 percent’ of that figure and reduced his average hourly wage to around $10, he says.)”

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It’s typical to have business expenses when there is revenue generated but in Barnard’s case, he was a few thousand dollars in debt after three months and was required to sell his car just to be able to continue with his day-to-day living.

He also had a wife he had to support. His story ended on a high note, but not all developers can be as lucky. According to Forrester Research, the average iOS app runs up some six months at the very least for creation and will cost anywhere between $20,000 and $150,000 to develop.

Once the app has been made, it will then have to go through Apple’s approval process. This is the most crucial part since there is a rejection rate of 60 percent, and often without clear and concise explanations why.

Apps for Apple are much more expensive to make than those for Android and here are some figures that will give aspiring developers an estimate of how much they might have to spend:

A well-designed yet simple application, an outsourced job will cost roughly $6,000. On the server side, it will be around $12,000. If the app manages to be written in two weeks, that will be an additional $12,000.

Factor in annual hosting fees, project management, delays and the like, and that will run up another $5,000. All in all, a developer may have to spend at least $35,000 for a basic app.

On the other hand, high-end applications, such as games, will cost more. A safe estimate for these apps will be around $200,000 at the very least.

It has been said that creating apps for Android is more cost-effective but it can still run up quite a bill, depending on the nature of the app being made. Here are some rough estimates:

Simple apps can cost some $4,000 to $12,000. This really does mean that it is rather basic and the content is static. For apps that are data driven, be prepared to shell out $6,000 to $40,000.

Apps that fulfill a functional need will cost the developer Cost $6,000 to $40,000. Games, a clear favorite, will cost $8,000 to $100,000 but those numbers could still grow depending on project complexity and size.

Android Developer Michael Burton says that the cost depends on a few things, but estimates that an app of average complexity will cost around $35,000.

The costs are great and if the developer has no funding, that project could easily be stalled or shelved. However, if the app takes off and makes more money than it cost to create, it’s easy to see why so many designers and developers are eager to take on the challenge.

If there are sufficient resources to see an app through from conception to fruition, there really is no reason not to try but one has to keep expectations realistic because it is much more common not to succeed the first time, or ever.

Learn more about development with our Mobile App Development Guide.