Then, the data is transmitted through the network layer to your cloud services and databases (middleware layer), where it’s stored and processed before finally reaching your IoT app (application layer).
Also, this works in both directions – both your device and app can receive and send data to each other through the middleware and network layers.
The app itself is built with the same tools and languages like any other app, though.
But, since it’s a part of a wider ecosystem, building an IoT app comes with its own set of challenges – we’ll cover them in more detail next.
Key IoT app development challenges
Here, we’ll discuss the top IoT app development challenges and give you key tips for solving them.
Security and privacy
Security and privacy are some of the biggest challenges in IoT app development.
IoT devices are often built with minimal computing power, which limits their ability to support advanced security protocols.
Each connected device within an IoT network presents a potential vulnerability and they’re often used as entry points for larger breaches.
And that’s what makes IoT apps uniquely vulnerable compared to a standard app. Here are some of the top vulnerabilities you need to watch out for:
Hackers can exploit these vulnerabilities to gain unauthorized access to the network, manipulate devices, or steal sensitive data.
The stats prove it, too.
On average, there are 5,200 attacks on IoT devices each month with 7 million data records compromised daily – and a successful data breach causes around $330,000 in damages.
So, focusing on security when building an IoT app is non-negotiable.
And it’s key to building a successful app.
Key tips for improving IoT app security and privacy
Implement strong encryption – Use encryption protocols such as AES to secure data transmission between IoT devices and the cloud. End-to-end encryption ensures that data remains protected at every stage.
Enable secure authentication – Use multi-factor authentication (MFA) to add an extra layer of security, which will prevent unauthorized access even if login credentials are compromised.
Regular updates and patches – Make sure your IoT devices and apps can receive over-the-air (OTA) updates. This will let you quickly address vulnerabilities and apply security patches without requiring users to manually update their devices.
Scalability
Scalability is one of the biggest technical challenges in IoT app development.
As your IoT network grows, you need to make sure your app can handle the increasing number of connected devices without a drop in performance.
And the number of devices in an IoT ecosystem can grow exponentially, from hundreds to thousands, or even millions.
This comes with several technical challenges like:
Increased data volumes – More devices generate more data. Processing and storing such a vast amount of data requires scalable cloud solutions and efficient data pipelines.
Network congestion – As more devices connect to the network, bandwidth becomes a limiting factor. Congestion can lead to delayed communication between devices and the app, affecting performance.
Computational strain – Your app’s back-end infrastructure must be able to handle complex tasks like real-time data analysis, which becomes more demanding as the number of devices increases.
An easy way to solve (most) of these problems is using cloud services like:
Operational scalability is your business’ ability to scale business processes and systems as demand for your app grows – it’s just as important as technical scalability.
Here, you’ll need business process automation (BPA) to scale your business as demand for your product grows, without sacrificing operational performance.
In short, scalability is not just a technical requirement – it’s a necessity for long-term success.
And that’s why you need to pay attention to it from the get-go.
Key tips for building scalable IoT apps
Implement microservices architecture – Microservices break apps down into smaller, independent components which makes scaling more efficient. For IoT apps, this architecture ensures that different components can scale as required without affecting the entire system.
Use edge computing – Edge computing moves data processing to the device, reducing the load on central servers and minimizing latency. This is particularly useful when you need real-time processing, like autonomous vehicles or industrial automation.
Adopt efficient communication protocols – Communication protocols like MQTT are lightweight and designed for high-latency, low-bandwidth networks and using them will reduce strain on the network as it scales.
Interoperability
Interoperability is another major challenge in IoT app development.
It refers to the ability of different devices, platforms, and applications to communicate and work together seamlessly.
Every IoT ecosystem has a lot of moving parts and each part has to be able to communicate with the other parts, often in both directions.
Proprietary systems – Many IoT manufacturers use proprietary systems to lock users into their ecosystem. This creates barriers to integrating with devices and apps from other vendors and makes achieving interoperability difficult.
Different data formats – IoT apps and devices often produce data in different formats, making it hard to aggregate and analyze. If data can’t be standardized across devices, your app can’t make real-time decisions.
Lack of universal communication protocols – Without widely accepted communication protocols, IoT devices struggle to communicate, especially if they operate on different frequencies or use different methods of data transmission.
But, there’s a light at the end of the tunnel.
For example, the Matter protocol, developed by a coalition of major players like Apple, Google, and Amazon, is designed to create a universal standard for smart home devices and apps.
And that solves a huge number of interoperability issues.
Key tips for improving interoperability in IoT apps
Adopt open standards: Use platforms and technologies that use open standards like MQTT or CoAP, which will help solve compatibility issues with different devices and systems.
Focus on API integration: APIs help different systems communicate and share data and if you build apps with robust API support, you’ll make it easier for devices to integrate and interact.
Test for cross-compatibility: Before deploying an IoT solution, test it across different platforms and devices to ensure they work together to catch any compatibility issues early.
Data management
Data is the lifeblood of IoT apps.
IoT devices continuously generate huge amounts of data, from sensor readings to real-time updates.
And that’s no exaggeration – they’re expected to generate 79.4 zettabytes of data in 2025 alone.
This data comes in various forms, including real-time streams from sensors, batch uploads, and periodic updates. Here’s an example of what that looks like:
Managing this amount of data is a huge challenge and comes with its own set of problems, like:
Data storage – Storing the data generated by IoT devices requires scalable storage solutions, as traditional databases often struggle to handle such a massive amount of data.
Real-time processing -Many IoT applications require real-time data processing, eg. industrial IoT solutions, and latency or delays in processing can lead to inefficiencies or even accidents.
Data quality – Poor data quality can undermine the effectiveness of your IoT app, so ensuring that data your devices gather is clean, accurate, and consistent is critical.
Data security and privacy – IoT devices collect sensitive data, often in real-time, and you need to prevent unauthorized access to it.
But, it’s not an impossible task.
You just have to make the right choices at the start of development – easy, right?
Key tips for effective data management in IoT apps
Implement data lifecycle management – Not all IoT data is valuable long-term and a data lifecycle management policy will help you reduce storage costs and ensure you only retain valuable data.
Focus on data governance – Establish clear policies for data access, security, and usage. This will ensure that only authorized users can access sensitive data and help you maintain data integrity and security.
Invest in data analytics tools – To make sense of IoT data, you should invest in advanced analytics tools. Platforms like Tableau or Power BI will help you visualize large data sets, making it easier to identify trends and make data-driven decisions.
Connectivity and offline functionality
Connectivity is a key factor for every IoT app and device.
IoT devices rely on reliable connections to communicate data and trigger actions.
Here’s an overview of the different types of IoT connectivity:
Unstable networks – In some environments, like remote industrial sites or rural areas, network connectivity is often interrupted. Your app needs to handle these disruptions without causing the entire system to fail.
High latency – Even in areas with network coverage, high latency can slow down data transmission, leading to delays in IoT apps that rely on real-time processing.
Device power – IoT devices that operate on battery power, like sensors in remote locations, have to balance connectivity needs with power efficiency.
That’s where offline functionality comes in.
Your IoT app should have (some) offline functionality, so it can still collect data and perform its core tasks even if it loses connectivity.
That’s key to its success.
Key tips for solving connectivity and offline functionality issues in IoT apps
Use multiple communication protocols – To ensure continuous connectivity, IoT apps should support multiple communication protocols and switch between Wi-Fi, cellular, and LPWAN as needed so they maintain connectivity even if one network is unavailable.
Design with failover mechanisms – Implement failover mechanisms in your IoT app so that if the primary connection is lost, the app automatically switches to a backup network or mode. This will ensure uninterrupted functionality for critical tasks.
Use local storage – Enable local data storage on devices so they continue collecting data when offline to prevent data loss if they lose a connection. And once you restore connectivity, the device will seamlessly sync with the cloud.
User experience (UX) and usability
User experience (UX) and usability are crucial if you’re building an IoT app.
A great IoT app not only has to perform well, but also offer an intuitive, smooth, and enjoyable experience.
If users can’t figure out how to use your app, even if it’s the most advanced IoT solution on the market, it won’t gain traction.
And there’s a number of things you need to look out for when designing an IoT app, like:
Multi-device interaction – IoT systems often involve multiple devices which need to be controlled through a single app interface. Easy navigation through the various features and functionalities is a major UX challenge.
Different user needs – IoT apps serve a wide range of users, from tech-savvy users to those who aren’t familiar with advanced technologies, so you need to consider simplicity, accessibility, and customization when designing your app.
Data overload – IoT devices generate a huge amount of data and presenting it in an understandable way, without overwhelming the user, is crucial.
Your users expect your app to be responsive and easy to use, regardless of its actual complexity.
It manages a wide range of different devices, from thermostats to door locks, all from a single app – yet, the app itself is user-friendly and easy to use.
And that’s exactly what you should be aiming for, too.
Key tips for improving UX and usability in IoT apps
Simplify your UI – Your app needs to have a simple, clean interface, even if the system it controls is complex. Use minimalistic design principles and focus on key features and functionalities.
Prioritize accessibility – Make sure a wide variety of people can use your app, including people with disabilities or who aren’t tech-savvy. You can do this by integrating voice controls, providing customization options, or offering tutorials for first-time users.
Consistency across devices – You should create a unified user experience across all devices in the IoT ecosystem. Whether a user is controlling a device via phone, tablet, or desktop, the interface and functionality should be consistent.
Lack of IoT app development skills
Another major challenge when building IoT apps is finding developers with the right skills and expertise.
This way, you’ll save yourself a lot of time and money you’d otherwise spend on hiring, onboarding, and training new employees.
And you won’t be sacrificing quality.
Key tips for closing the IoT skills gap
Invest in training and upskilling – You can bridge the IoT skills gap by offering training programs for your existing team, like courses on embedded systems, network protocols, or cloud computing.
Hire an IoT app development company – If you don’t have the right skills in-house , partnering with an external IoT app development company is the best way to close the gap and successfully build your IoT app.
Use IoT development platforms – Platforms like AWS IoT Core and Microsoft Azure IoT Hub provide easy-to-use APIs, data management, and device integration capabilities that reduce the need for specialized skills.
IoT app development challenges: FAQs
The biggest challenges in IoT app development are:
Security and privacy
Scalability
Interoperability
Data management
Connectivity and offline functionality
User experience (UX) and usability
Lack of IoT app development skills
To build an IoT app, you need to follow the following steps:
Define your requirements first
Get the right hardware components
Choose the right IoT platform for your app
Develop the software and connect it with the hardware
Thoroughly test your IoT app
Get user feedback and iterate
There’s no straightforward answer on how much an IoT app costs to build.
The total cost of your IoT app’s development will depend on a number of factors:
IoT device type
Size and location of the development team
App type and features
The third-party integrations it needs
Security and compliance
Long-term maintenance costs
But, we can give you the typical cost ranges based on complexity:
Basic IoT apps – These apps are typically designed to manage a single device or a small number of straightforward tasks, like turning on smart lights or adjusting a thermostat. Costs for these apps typically range from $30,000 to $50,000.
Advanced IoT apps – If you’re building an app that connects to multiple devices or requires advanced features like real-time data analytics or geolocation, costs increase significantly. These apps generally fall within the $50,000 to $150,000 range.
Complex IoT apps – Enterprise-level solutions or apps that integrate with a wide variety of devices or use advanced technologies like AI, can easily cost $200,000+ to build.
Need an IoT development partner?
Do you need help building an IoT app but none of the companies you talk to are the right fit?
Luckily, you’re in the right place.
In the past 12+ years we’ve built a number of IoT apps in industries ranging from healthcare to HVAC.
So, we know a thing or two about what it takes to build a great IoT companion app.
If you want to learn more, feel free to reach out and our team will be happy to set up a quick call to answer all of your questions.
When something unusual happens, Vlado is the man with an explanation. An experienced iOS Team Lead with a PhD in Astrophysics, he has a staggering knowledge of IT. Vlado has a lot of responsibilities, but still has time to help everybody on the team, no matter how big or small the need.
His passions include coffee brewing, lengthy sci-fi novels and all things Apple. On nice days, you might find Vlado on a trail run. On rainier days, you’ll probably find him making unique furniture in the garage.
