Apple Inc. (NASDAQ:AAPL) could charge its users up to $20 for its advanced artificial intelligence features, according to a top analyst. The move could further bolster the company’s already lucrative services business.
What Happened: Apple is gearing up to roll out Apple Intelligence, its new AI system, across some of its devices later this year. The system, announced in June, includes enhanced features for the Siri voice assistant and other generative AI features aimed at enhancing the email and image editing experience, among other things.
Neil Shah, a partner at Counterpoint Research, explained that the high cost of AI development could prompt Apple to pass on the expense to its users. "Software and services makes [sic] it more lucrative for Apple to pass it on with the Apple One subscription model," Shah said in an interview with CNBC.
Apple One currently costs $19.95 a month and provides access to various Apple services, including Apple Music. The potential introduction of a premium AI feature subscription could further boost Apple’s services segment, which generated $24.2 billion in the previous quarter.
Alphabet Inc.‘s (NASDAQ:GOOGL) (NASDAQ:GOOG) Google, Apple’s rival, offers many AI features in its Pixel phones for free.
The Pixel 8 Pro, the first to run Gemini Nano, powers features like Summarize in the Recorder app, Magic Compose for rewriting messages, and Magic Editor in Google Photos for object movement and lighting enhancement. Google also leverages AI to reduce blur and visual noise in photos.
These features will be gradually rolled out, with some regions possibly being charged a subscription fee for the more advanced apps.
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Why It Matters: The tech industry has been witnessing a surge in AI-related developments. At the Google I/O event in May, Google announced several AI-related features, including AI Overviews, a revamped version of Search Generative Experiences designed for complex questions.
Apple’s potential AI subscription model follows its rivals’ moves. In March, Google introduced a new bundle for its subscribers in the UK, adding value to its cloud storage plans with the inclusion of Nest Aware and Fitbit Premium.
Recently, a Reddit user found pre-prompt instructions embedded in Apple's developer beta for macOS 15.1. These instructions offer a rare glimpse into the backend of Apple's AI features, such as the Smart Reply feature in Apple Mail and the Memories feature in Apple Photos.
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Photo courtesy: Apple
This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote
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