Apple+ may charge users up to $20 for advanced AI features as part of its strategy to grow its services business, analysts told CNBC. The Cupertino-based tech giant is expected to launch Apple Intelligence, its new AI system, across select devices later this year. When Apple introduced its AI system in June, it highlighted improvements to Siri and new features like automatic email and image generation. Although these features will be released gradually, with some regions like China and Europe initially excluded, analysts predict Apple might implement a subscription model for its more advanced AI applications. Neil Shah, partner at Counterpoint Research, noted that AI investment is costly, and Apple is likely to pass these costs onto users. “Software and services make it more appealing for Apple to include it in the Apple One subscription,” Shah said in an interview with CNBC last week. Apple One, which costs $19.95 per month, currently offers access to various services like Apple Music. Shah suggested that Apple Intelligence could be priced between $10 and $20, potentially as part of the Apple One bundle, for premium AI features.
Apple’s services division generated $24.2 billion in revenue during the June quarter, distinguishing itself from many other hardware companies that have struggled to monetize software. Ben Wood, chief of research at CCS Insight, noted in an interview with CNBC, “Apple is one of the few connected device companies that has effectively monetized the value-added services it provides. Consequently, it has established an expectation among its users to pay for premium services. Based on this, it’s possible that Apple could consider charging for more advanced features within its Apple Intelligence offering.” Wood further suggested that Apple Intelligence might pave the way for the company to launch a bundled subscription service, integrating various services under a single pricing model. However, he also acknowledged that Apple might be hesitant to dilute revenue from individual product subscriptions.
Charging for AI services is not uncommon among tech firms. For instance, OpenAI offers a subscription for advanced ChatGPT features, and Microsoft charges for its AI Copilot tool. Samsung, Apple’s main competitor, has also entered the AI space with its Galaxy AI services, though the company is still exploring different revenue models, as its mobile chief shared with CNBC last month.
For Apple, AI presents an opportunity to further cement customer loyalty. According to Shah, Apple Intelligence will learn from users’ behaviors, becoming increasingly personalized over time. “The advantage of AI is that the more you use it, the better it understands you. This creates a level of dependency, making it difficult to switch from Apple to Android,” Shah explained. “That’s where Apple’s monetization strategy comes into play, as users become more accustomed to the ecosystem and are less likely to leave it.”
