Apple’s new AI features may not come cheap.
The Cupertino, Calif.-based company could charge up to a $20 subscription fee for access to some of its advanced artificial intelligence features when they are finally made available this fall, analysts told CNBC.
“Software and services makes it more lucrative for Apple to pass it on with the Apple One subscription model,” Neil Shah, partner at Counterpoint Research, said.
Apple already charges customers $19.95 a month for Apple One, its package that bundles up to six premium subscriptions including Apple Music, Apple TV+ and Apple News+.
Shah told CNBC the company could charge $10 to $20 for premium AI features, or even bundle the AI features in Apple One for a higher price.
“Apple is one of the few connected devices companies that has successfully monetized the value-added services it offers,” Ben Wood, chief of research at CCS Insight, told CNBC.
“[It] has set a precedent with its users that they have to pay for more premium services. On this basis, it can’t be ruled out that Apple may choose to charge for more advanced features within its Apple Intelligence offering,” Wood told CNBC.
The Post reached out to Apple for comment.
Costs for AI can start as low as $5,000 and reach far beyond $500,000 for cutting-edge developments, according to tech consulting firm Future Processing.
And for big tech, the costs are even higher – Microsoft, Alphabet, Meta and Amazon are expected to spend more than $1 trillion on AI investments, according to Goldman Sachs.
OpenAI charges a subscription fee for advanced ChatGPT features. Microsoft charges $20 a month for Copilot Pro, a version of the free Copilot program that is more advanced and uses AI.
Apple revealed the new AI features during its June conference.
The tech company made its AI program available to some software developers for testing in late July but reportedly will delay the rollout to the public until October — a few weeks after Apple had initially planned to make it available as part of its iOS 18 and iPadOS 18 releases.
Apple Intelligence includes improvements to Siri, enabling the voice assistant to better understand what users are asking and allowing it to access users’ personal information.
The AI will automatically create summaries of text messages, voicemails and emails, as well as generate emojis and images.
Last week, Apple reported second-quarter services revenue of $24.21 billion, above LSEG analysts’ expectations of $24.01 billion. The company expects its services division to continue growing at the same rate it reported over the past year, which is about 14%.
Apple Intelligence gives the company an opportunity to create an even more loyal customer base.
As customers use Apple Intelligence more and more often, it will gather more data and become more personalized. So moving on from Apple Intelligence will be a tougher move, and customers will be unable to transfer the AI to rival brands’ devices.
“The beauty of AI is as you use [it] more and more, it learns about you, and you get locked into the model itself because you can’t bring your own model from Apple to Android,” Shah told CNBC.
“That is where you start using more and more, you get used to it more and that is where Apple monetization hits.”
Rival Samsung has already begun rolling out its version of AI – Galaxy AI – onto some of its devices.
Galaxy AI can automatically generate summaries for notes, translate live conversations and translate phone calls. Samsung phones with Galaxy AI have cameras with auto zoom capabilities.
Samsung is still considering different revenue models, the president of Samsung’s mobile division told CNBC last month, so it is unclear whether the two companies will go head-to-head with AI subscriptions.
