AI Subscription Battle? Apple Rumored to Charge for its Apple Intelligence

According to CNBC, Apple may charge up to $20 for certain Apple Intelligence AI features.

Apple Intelligence to Introduce Subscription Fee

Apple announced its artificial intelligence (AI) plans at the WWDC on June 10th, including the integration of OpenAI's ChatGPT feature for Siri when needed. This has raised expectations among Apple enthusiasts for the upcoming iPhone 16. However, the question remains: how long will the Apple Intelligence AI features be available for free? Will there be any caveats to the free usage? Only time will tell.

Apple positioning itself as an AI service platform in collaboration with OpenAI without any charges?

According to a report from CNBC, Neil Shah, a partner at Counterpoint Research, suggested that Apple might charge a monthly fee of $10 to $20 for Apple Intelligence, possibly as part of the Apple One subscription service. Apple's services segment generated $24.2 billion in revenue in the second quarter, making it stand out from many other hardware companies that struggle to profit through software.

Software and services have made Apple's Apple One subscription model more profitable.

Ben Wood, research director at CCS Insight, also noted that Apple is one of the few connected device companies that have successfully monetized its value-added services.

Apple has set a precedent for users that they may need to pay for premium services. Based on this, it is possible that Apple may choose to charge for advanced features within its Apple Intelligence products.

What is Apple One?

Apple One is a multi-service subscription introduced by Apple that allows users to subscribe to multiple Apple services at once. These services include:

• Apple Music: Streaming service with millions of songs
• Apple TV+: Original Apple shows and movies
• Apple Arcade: Over 200 ad-free, in-app purchase-free games
• iCloud: Cloud storage for photos, files, and more

In Taiwan, Apple One offers two subscription plans:

• Individual Plan: NT$390 per month, including Apple Music, Apple TV+, Apple Arcade, and 50GB of iCloud storage.
• Family Plan: NT$490 per month, including Apple Music, Apple TV+, Apple Arcade, and 200GB of iCloud storage, shareable with up to five family members.

High Development Costs for AI, Who Will Introduce Paid Models First?

The development and maintenance costs of artificial intelligence are high, and subscription revenue provides a stable income source for tech companies. According to a report from Forbes, Google is planning to charge $19.99 per month for its Google One AI Premium, bundling Gemini Advanced with 2TB of cloud storage, with UK subscribers also getting access to Nest Aware and Fitbit Premium for free.

While Samsung was the first to introduce free AI services on its phones, it emphasized that Galaxy AI will only be free until 2025. Considering the billions already spent on building these language models and the ongoing maintenance costs, Samsung needs to find ways to recoup the investment.

Forbes author Janhoi McGregor believes that Samsung, Google, and Apple are engaged in a "game of chicken" regarding AI tools. Any decision to introduce a paywall could face strong public backlash, providing a reference for competitors' decisions. The most likely approach could be offering basic free functions for daily use and premium paid features, as there are still many obstacles to overcome before integrated paid AI functions become a reality. Therefore, Apple Intelligence, Galaxy AI, and Google AI are likely to remain mostly free in the foreseeable future.

Considering the current subscription costs of Apple One in Taiwan, the integration of Apple Intelligence may not seem too "pricey" after all. Given the high costs of AI development, user payments are reasonable, and services like ChatGPT have various subscription models, distinguishing them from the free version.

Summary of ChatGPT features, how much does it cost to use AI monthly?