Analysts suggest that Apple might set the price for certain Apple Intelligence AI features as high as $20.

Apple is considering charging up to $20 for its advanced AI features, according to analysts who spoke with CNBC. This move is part of Apple’s strategy to expand its profitable services sector. The company plans to introduce its new AI system, Apple Intelligence, on some devices later this year.

When Apple unveiled Apple Intelligence in June, it highlighted enhancements to the Siri voice assistant and new capabilities like automatic email and image generation. These features will be gradually introduced, with initial rollouts excluding regions like China and Europe. Analysts suggest that Apple might implement a subscription model for these advanced features.

Neil Shah from Counterpoint Research noted that AI development is costly, and Apple will likely pass these expenses on to users. He mentioned that integrating these features into the Apple One subscription, which costs $19.95 per month and includes services like Apple Music, could be a viable option. Shah estimated that Apple might charge between $10 and $20 for the premium AI features.

In the June quarter, Apple’s services division generated $24.2 billion, distinguishing it from other hardware companies that struggle to monetize software. Ben Wood from CCS Insight pointed out that Apple has successfully established a precedent of charging for premium services, making it plausible that the company might charge for advanced AI features as well.

Wood also suggested that Apple Intelligence could be bundled with other services under a single subscription price, although Apple might be cautious about reducing revenue from individual subscriptions. Charging for AI services is not uncommon in the tech industry, with companies like OpenAI and Microsoft already doing so.

Samsung, Apple’s main competitor, has also started rolling out its AI services, Galaxy AI, and is exploring different revenue models. For Apple, AI represents an opportunity to further engage its loyal customer base. Shah explained that as users interact more with Apple Intelligence, the system becomes more personalized, making it harder for users to switch to other platforms. This increased usage and dependency could enhance Apple’s monetization efforts.