How Much Does AI Software Cost?
When analysing the cost of AI software, you need a budget anywhere between £4,000 for simple models to £400,000 for tailoring advanced bespoke AI models. The exact costs are largely influenced by several factors like project complexity, constraints involved, technologies used, and more.
With so many factors involved, it can appear tricky to determine the exact prices. This blog helps you understand important factors to consider when examining AI software development cost.
Here are main factors deciding the cost of AI projects
Various aspects like programmer hiring cost, necessary hardware procuring, and more play a key role in defining the cost of AI solutions. Some of these may be optional for your project as developers may use open-source & third-party solutions instead of building the entire software from scratch.
Let’s inspect these factors:
1. Programmer expenses
One of the most prominent costs includes paying for the AI developers and other specialists like ML experts, data scientists, etc. These usually span from £50,000 to £100,000 per year per engineer. It also includes paying for using AI tools and software licensing fees.
2. Data management
High quality data must be extracted from relevant sources to train AI models. A Massive amount of money is needed for data collection, cleaning, and processing, and lies between £4,000 to £25,000. You cannot neglect data when building AI models, so it plays a vital role in influencing the final costs.
The infographic below provides insights into the training cost of AI models.
You may find it interesting to learn that DeepSeek only needed £4.8 million and 2,048 GPUs to train. On the other hand, OpenAI usually spends an estimated £80 million to £1 billion on training similar models.
3. Regular maintenance
Once you launch the AI applications, it needs to be updated to keep it relevant with the industry trends and user demands. Annual maintenance cost of AI solutions lies in the range of 10% to 20% for most projects. However, this can go very high for handling complex projects with a massive use base. When defining how much does AI cost, there are also a few optional factors that influence the pricing.
4. Hardware investments
Certain projects may require greater computational power and attract investments in GPUs (Graphics Processing Unit) and servers. These cost between £8,000 and £40,000. However, various AI projects leverage Cloud or existing hardware that makes this expense optional.
5. AI integration costs
The AI cost for integration arises when you need to empower your current IT infrastructure with artificial intelligence capabilities. A software agency will build applications for compatibility or purchase middleware, and the prices will be between £4,000 and £15,000. However, if you’re planning to build standalone AI applications, the integration cost does not arise.
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When should businesses build AI?
Companies should build AI when they have a clear, well-defined business problem that can be significantly improved by artificial intelligence capabilities. Other factors to consider are access to relevant data and a dedicated team with the necessary technical expertise. Your partner software agency must have a strong understanding of the ethical and regulatory implications.
Key factors to consider before building AI:
Business need: Do you have specific business challenges that AI can address effectively? AI must help you increase efficiency, improve customer experience, or channel new revenue streams.
Data availability: You must define smooth access to enough high-quality data to train your custom AI model accurately.
Technical expertise: Does your team have the necessary skills to develop and manage AI systems
Understand the market landscape: Are your business competitors already leveraging AI in your industry?
Regulatory considerations: Are there any legal or ethical issues related to AI use in your industry?
When to consider building AI?
High-volume repetitive tasks: When manual processes are time-consuming and prone to errors, AI can automate them.
Customer insights and personalization: You need to analyse customer data and provide tailored experiences
Predictive analytics: Trying to forecast futuristic trends, and you need to implement well-informed decisions
Quality control and anomaly detection: For identifying issues in production or other business operations
Research and development: To accelerate innovation through AI-powered analysis for specific business industries.
It is advisable to begin with a focused AI project that provides clear value and can be scaled up later. Try involving different departments and all the stakeholders to ensure alignment with business goals and address potential challenges. Choose software partners who develop AI systems that are fair, unbiased, and transparent.
How much does it cost to start an AI project?
The initial budget requirements for an AI project can be estimated on the type of application. For example, building an AI chatbot can cost less and require between £4,000 to £15,000. On the other hand, if you are building a generative AI product, the budget can soar by millions and billions.
This is because simple projects are often based on handy frameworks and require a limited level of customisation. On the other hand large scale projects require greater time and effort from the AI development team. They also require use of complex technologies like NLP, deep learning models, and more. Artificial intelligence cost of the projects soar high due to these factors and such projects also have high operational costs.
What main factors influence the start-up costs of AI projects?
Project Complexity: Building complex ideas into artificial intelligence requires months and sometimes years in development time and access to skilled experts.
Data Requirements: AI models require extensive data collection, and preprocessing can increase the overall cost of the project.
Knowledge and Skills of the Development Team: Finding and hiring AI experts is a costly undertaking. You need to hire software developers who are well-versed in relevant AI technologies that will be used to build the project.
Chosen Technology Stack: Deciding a suitable technology stack for the AI model requires choosing from several open-source tools and proprietary software. This involves paying upfront for the licensing fees that adds to the overall expenses.
What is the difference in cost between developing an AI solution in-house vs. hiring external experts?
Choosing between whether to build the solution in-house or hire external experts can influence your budget. Hiring in-house employees in AI technologies like Machine Learning experts, Natural Language Processing experts, data scientists, developers, and filling-in other positions can lead to a substantial increase in the project budget.
The average annual salary for an AI developer in the UK is around £59,108, with a typical salary between £43,000 and £75,000. Similarly, the Machine Learning Engineer in the UK is around £55,000 – £60,000 per year, with the median salary being closer to £57,500.
Building your ideas through a software agency can help you save AI project costs and empower you with faster time-to-market ideas.
Conclusion
Analysing how much does AI cost, you need to begin with identifying key functional features, programmers expenses, data procuring methods and pricing. Each project is unique in terms of the stakeholders, technology stack, and more.
At Coding Sprint, we can provide you with guilt-free estimates for your AI project. We weigh several factors to help you decide the budget needed to transform your ideas into viable solutions.
