Cost of Internet of Things (IoT) Prototype Implementation

The prototype, an early-stage version of Internet of Things devices, is one of the pivotal IoT implementation steps that helps test and refine the final product’s functionality. But what is the cost of an IoT prototype? And how to figure out if you need such a solution?

In this article, WebbyLab will answer these questions, leveraging its vast experience in IoT prototyping. As a part of our discussion, we’ll explore the importance of IoT prototypes and the peculiarities of their development based on our projects like Propuskator ACS, an intercom system, and more.

The Specifics of Prototyping IoT Products

Unlike market-ready IoT products, the Internet of Things prototype covers the IoT solution’s basic features. It helps to check the product’s hypothesis, gain client feedback, and analyze the specifics across all IoT development stages.

Besides, with the Internet of Things prototyping, you assemble a product requirements document, a checklist, a project roadmap, and a budget scope for a future solution. Considering those subtleties increases your understanding of the full-fledged product you aim to create.

Prototyping devices in IoT is a complex process that covers multiple components, including the IoT product itself, hardware, and software solutions. In addition, the team should test IoT prototypes for compatibility with communication protocols, security tasks, microcontroller characteristics, and beyond.

When compared to the market-ready IoT solutions, the IoT prototype also has the following differences:

• It doesn’t have to be ready for production. The IoT prototype’s primary goal is to bring a general understanding of the target product without many upfront costs.
• It executes the most essential tasks. An IoT prototype usually tests the minimum necessary features and processes to ensure their feasibility in a full-fledged solution.
• It has a variable cost of production. Depending on the IoT project’s scalability (hundreds of devices or billions of ready-to-market products), IoT prototyping helps to wisely allocate the budget for the entire project and define the possible ways for cost optimization.

Anatomy of an Internet of Things Prototype

Understanding the development anatomy is simply a must to create your IoT prototype and understanding its cost formation. It helps comprehend its essential components and develop the best strategy for the upcoming IoT project.

 Every IoT prototype consists of the following essentials:

• Hardware — all the components that make up your device. It’s important to cover the regulators, standards, and laws depending on the target industry and market focus on harmonizing the prototype and IoT solution.
• Firmware — programs on your device performing particular functions. It also includes the required code to manage communication protocols and data processing. Thus, firmware ensures the seamless operation of an IoT solution.
• Software — for management, monitoring, and analysis of the IoT prototype and data it collects. We recommend using ready-made software. In particular, many open-source and paid platforms are already available for standard IOT protocols and tasks. For example, WebbyLab’s 2Smart project offers a pre-built backend, web, and mobile application for testing any device communicating via MQTT.

However, the software isn’t always integral to IoT prototyping. You may skip this part when working on your prototype by checking the device in headless mode or making a built-in interface (like the device’s web admin).

4 Main Stages of Developing an IoT Prototype & Their Costs

The WebbyLab team is working on the IoT prototype implementation.

To clarify what`s the stages of implementation, as well as how much an IoT prototype will cost, let’s analyze this process based on the best WebbyLab’s case studies.

1. Collecting the Requirements & Understanding Goals

Regardless of your project, the standard prototyping process starts with shaping the requirements and expectations of a custom IoT prototype. It defines what product you need and what conditions or certifications to focus on.

Gathering requirements and determining goals is one of the crucial IoT implementation steps and a foundational stage for the entire project. This IOT development process usually involves a business analyst or technical specialist who works with the client on the following tasks:

• First, they discuss the general idea with possible, desirable, and acceptable solutions. This way, specialists build the concept of the entire product.
• From the created concept, they highlight the main tasks that need verification or are unclear and challenging.
• Finally, they develop a detailed requirements description of the entire project. It focuses on the must-have tasks and a brief explanation of the rest. This description also includes the tasks set for the IoT prototype stage with the budget and implementation timeline.

This stage of IoT prototype development also involves the following steps: 

• Conducting thorough market research 
• Studying competitors and their solutions 
• Collecting feedback from the user 
• Ensuring its usability and relevance 
• Checking some technology or a mix of technologies 
• Understanding whether there is enough expertise to complete this project, and more.

The cost of the research stage depends on how many aspects should be covered and typically starts at $500.

Our Case

Let’s explore how WebbyLab conducts the research stage:

• Prototyping a Digital Converter for Analog Intercoms

One of WebbyLab’s customers needed a device that connects to outdated wired intercoms. This IoT solution was aimed at helping receive calls on smartphones and talk to guests remotely without picking up the physical receiver of the intercom.

Since the client didn’t need an accurate and unambiguous solution, nor the usability of the product research, the WebbyLab team proposed to make an IoT prototype that covers the device and app together in a single system.

As a result, our developers were to create an Internet of Things prototype that enables receiving calls, audio, and video from the intercom on both sides, with the option of unlocking the door. 

• Prototyping the Access Control and Management System Propuskator

For the Propuskator controller, we conducted a requirements-gathering phase to define our core goals and tasks. 

We started with a basic version of the controller. Then, our team progressed to multiple versions with Ethernet and GSM and expanded device management capabilities. Finally, we delivered a comprehensive solution with all the mentioned features combined.

Since our experts had a solid foundation, they could efficiently discuss and develop new prototypes for subsequent versions with additional features.

• Prototyping a Home Security Robot

A home security robot prototype created by the WebbyLab team.

To create a robot guard, we defined the concept and outlined the main features during the research stage. Our team also established the expected results from the prototype upfront.

• Prototyping a Battery-Powered ESP32-Based Device

We developed a battery-powered ESP32-based device with multiple wake-up modes. During the data collection phase, we determined which peripherals to connect and which functions to perform. Then, we made an estimate and listed the outputs.

2. Selecting the Right Hardware for IoT Prototype

Next, it’s essential to pick up the proper hardware that will better fit our prototyping IoT project, which usually depends on its type and objectives. Thus, first of all, we create PoC (Proof of Concept), which is based on ready-made hardware solutions and aimed at checking the product hypothesis, to ensure it’s relevant and valuable at the time of release and afterward.

At this stage, it’s a good idea to evaluate multiple solutions and select the optimal one considering the cost and quality for the intended tasks. Verifying firmware compatibility with the chosen hardware is also crucial. We suggest using as many pre-built solutions as possible instead of creating custom prototypes by soldering or assembling them on a breadboard. That’s because you can replicate them on a custom board during hardware development.

Based on the project type, you’ll choose a certain set of prototyping IoT sensors and devices that will help to perform the desired features.

Typically, the overall cost of this Internet of Things prototype development stage is about $1000.

Our Case

Here’s how WebbyLab experts select hardware for their projects:

• Choosing the Right Hardware to Turn the Analog Intercoms into Smart

Once we’ve researched the principles of intercom performance, we’ve moved toward hardware selection.

For our project, we’ve decided to assemble a prototype of a device based on Raspberry Pi and a ready-made analog signal converter. Additionally, to cover the required functionality, WebbyLab’s engineers also embedded several components for monitoring the call, receiving it, and sending commands to the video.

• Selecting Hardware for the Propuskator ACS

As part of the Propuskator project, we tested multiple ESP options. Then, our experts selected the most suitable GSM module and Ethernet socket based on price. They decided to make an adapter for an expansion board with additional functions.

During the prototype stage, our team tested the concept of using shields (additional boards). One can install them on the baseboard for different functionalities, like Ethernet, GSM, and relay control for four devices simultaneously.

• Testing Hardware for the Security Robot

For the guard robot, we tested several versions of Raspberry Pi and Orange Pi. Then, we chose the optimal one in terms of power and price. Also, we selected the best options for sensors and peripherals.

• Choosing Hardware for a Battery-Powered IoT Solution

Our team tested the possibility of using the ESP32 as the main microcontroller. As part of prototyping, we registered the most significant risk points and passed them on to the hardware development team. WebbyLab experts also checked the device’s power consumption. As a result, our specialists ensured it met the set goals. Besides, we tested available ways to wake the device from sleep mode with the necessary triggers.

3. Choosing the Proper Tech Stack

At this stage, you should test and choose technologies, protocols, libraries, and methods for writing firmware to solve specific tasks. Those should be the tools you can later use in a full-fledged product.

The price of this Internet of Things prototyping stage can vary significantly, ranging from zero to approximately $1500. If the team has prior experience and doesn’t need to choose the technology stack from scratch, this step can be skipped or cost very little. Yet, in cases where extensive testing of alternatives is required, the price can be higher. Ultimately, it depends on the project’s and device’s specifics.

Our Case

Take a look at how our team selected the tech stack for our projects:

• Choosing the Tech Stack for the Analog Intercoms’ Digital Converter

According to the project specifics, our team has researched the list of the tech stack that could be potentially used for launching a cloud-based solution. We agreed not to develop the custom solution in an IoT prototype and decided to use Asterisk software to ensure the smooth performance of real-time calls. We also figured out how to make calls through SIP intercom technology. Finally, we discovered how to convert and broadcast video and sound in two directions.

• Selecting Technologies for the Propuskator Project

We selected a firmware stack based on the ESP32 chip (specifically, the ESP-IDF framework). Our experts also checked the availability of problem-solving methods in the frameworks for each sub-project.

• Choosing the Tech Stack for the Security Robot

As part of robot guard prototyping, we checked the possibility of writing software on Node.js. Our team also tested several ways of broadcasting videos from the device in real time. This way, users could control the robot without delays, even through the cloud.

• Selecting the Tech Stack for a Battery-Powered ESP32-Based Device

For this project, we tested framework tools and ways to wake up the device at the firmware level. Then, we passed the technical task to the IoT device development team.

4. Development & Testing

Similar to other projects, IoT prototyping starts with choosing the development model (agile, for example), and setting up the deadlines for each development phase based on its complexity and possible challenges. This helps ensure the rapid building of IoT prototypes and solutions with minimum time and maximum efficiency.

Also, it’s essentially important to create a QA testing strategy to identify the possible bugs, as well as clear out the risks and challenges that can come out during the IoT project development.

How much does an IoT prototype cost? The final stage of prototyping is extremely volatile, starting at $3000 on average.

Our Case

Here’s how we conducted the development and testing phase of our projects:

• Developing and Testing a Prototype of a Digital Converter for Analog Intercoms A ready-made prototype of a digital converter for analog intercoms.For this project, we chose the agile model that implies a parallel development of different processes within the alpha and beta phases and final IoT prototyping production. Based on the selected tech stack and hardware, our team set up a configured Asterisk software on a cloud server and finalized it on Raspberry Pi.As a result, the system was thoroughly tested for bugs, vulnerabilities, and functionality performance, to ensure it can digitize the signal and make calls. Additionally, we’ve provided a list of recommended mobile, web, and desktop applications for finalized IoT products.The overall budget of the current IoT prototype cost $6,000, according to which the client has been delivered:
  • A working converter prototype that could be connected to a test intercom
  • Client management software
  • List of compatible mobile, web, and desktop applications for customers
  • Analysis of the possible IoT product functionality 
  • Analysis of potential risks and difficulties during the development process
  • A recommended list of must-have hardware and basic functionality to include

  As a result, Webbylab delivered a well-performing intercom prototype that can receive and accept calls, digitize video and audio, hang up, and give a command to open.

  • Developing and Testing the Propuskator ACS Prototype

  During the prototyping stage, we tested and developed an almost ready-made solution. It required minimal hardware and software changes before sending it to production. Since our team had access to pre-built software, we could test the solution on a real platform right away. We only had to make specific modifications to accommodate the additional features of the new device’s versions.

  • Developing and Testing the Prototype of the Security Robot

  Our team has assembled several security robot versions with compatible firmware on various wheeled and hardware bases. We also connected them to our 2Smart Cloud platform to test pairing and management via a cloud-based mobile app.

  • Developing and Testing a Battery-Powered Device Prototype

  We connected the prototype to our 2Smart Cloud platform to test its operation through the cloud server and configure the pairing flow. Thus, firmware and hardware solutions from the prototyping stage became the basis for a full-fledged product.

  Read also: How to manage a project in 5 steps?

  How to Calculate the Total Cost of an IoT Prototype Solution?

  So what are the costs of developing an IoT prototype? From our experience, it’s about $6,000. But the Internet of Things prototype cost may differ significantly, so you should calculate it correctly. Here’s what to consider:

  1. Hardware costs. First, estimate the budget for all the hardware components required for the prototype, including sensors, microcontrollers, etc.
  2. Firmware and software costs. Consider development costs and the licensing fees for ready-made software. Also, calculate expenses associated with cloud services, data storage, and third-party software integrations.
  3. Manufacturing costs. Estimate the expenses of manufacturing the prototype.
  4. Testing costs. Calculate the costs for IoT prototype testing.
  5. Overhead costs. Remember to consider any expenses that might be above your budget.

  Unfortunately, there’s fixed answer to the question “how much does IoT cost” — everything depends on multiple factors:

  • Prototype’s complexity (consider features, integration of hardware and software components, etc.)
  • Hardware components (sensors, controllers, communication modules, etc., also impact the cost)
  • Software development (it may impact your cost if you choose custom development or buy ready-made solutions on the market)
  • Design and documentation (take into account the prototype’s design decisions, technical documentation, and compliance with industry standards)
  • Expertise and resources (consider expenses of hiring the required talent)

  The above parameters impact the costs to develop an IoT prototype app. Therefore, you should keep them in mind before initiating your project.

  Why Should You Prototype Your IoT Device?

  Starting your IoT project from its prototyping is not an option, but rather a necessity, and not solely in terms of time and cost efficiency. The other benefits of prototyping IoT solutions are described as follows:

  • Brings clarity to the IoT product design and user experience
  • Gives you important information regarding the use cases
  • Provides you with early feedback from users and your team
  • Allows using ready-made open-source and custom solutions
  • Mitigates risk and allows to understand the potential problems

  With this said, prototyping opens up new ways to design IoT solutions in a smart way. With the right vendor on board, you can ensure to test the ideas efficiently and develop the right strategy for your upcoming IoT project development on average starts at $5500 and higher. To get a more accurate estimation of your project, in particular, we suggest contacting our experts.

  How to Reduce IoT Prototype Costs?

  Suppose you’ve considered all IoT prototyping requirements and aren’t pleased with the cost of developing an IoT prototype. If that is the case — no worries. Use the following tips to lower your project expenses.

  • Increase your awareness in the IoT field, understanding of your goals, and ways to achieve them.
  • Choose experienced IoT vendors.
  • Stick to the recommended project flow.
  • Avoid custom development of too many tasks and features.
  • Choose ready-made open-source or paid solutions at the prototype stage.
  • Assemble a device prototype without production, in small batches, and from ready-made components (using 3D printing as an option).
  • Skip tasks that won’t bring sufficient business value.
  • Focus on the competitors’ solutions, considering their successful decisions and mistakes.

  Leveraging these tips will help you save some money and spend them on more critical procedures of your IoT project.

  Conclusion

  As you can see, creating an Internet of Things prototype is one of the most essential aspects of IoT development, regardless of the project’s specifics, target industry, and scale. Though it requires lots of effort, planning, and expertise, it truly helps to understand the project characteristics, covering the major challenges with hardware and software, as well as the relevancy of features included. As a result, you’ll be able to define the most efficient development model that ideally fits your business goals and budgeting, reducing all the risks and forecasting the project’s performance.

  Are you looking for a dedicated development team to launch a custom IoT project? Request a consultation today and discover how to make the most of your IoT business idea with Webbylab’s best IoT experts!