Google’s latest move has sent ripples through the tech industry as it plans to introduce a groundbreaking pricing model for its innovative artificial intelligence (AI) enhancements, designed to elevate the functionality of Gmail and other productivity apps. In a strategic maneuver, the tech giant will charge large businesses a subscription fee of $30 per user per month for access to its Duet AI technology, marking a pivotal step forward in the integration of AI into core business processes.
This announcement comes hot on the heels of Microsoft’s own initiatives in this sphere, particularly its 365 Copilot enhancements, which are projected to potentially hit the market within the first half of the upcoming year. Notably, both Google and Microsoft are engaged in a rapid race to capitalize on the momentum created by OpenAI’s groundbreaking ChatGPT chatbot, which emerged onto the scene just last year.
In a market where subscription fees for productivity suites are already in place, Google’s move to charge an additional $30 per user per month for its AI-powered enhancements has sparked a dialogue about the value proposition of such advancements. To assuage concerns and provide a glimpse of the future, Google is generously offering free trials for businesses, enabling them to experience the transformative power of Duet AI before fully committing to the subscription.
For those operating on a smaller scale and individual users, Google has yet to finalize the pricing structure, leaving a sense of anticipation in the air. Aparna Pappu, Google Workspace’s Vice President and General Manager, shared insights on the thought process behind the pricing, emphasizing that the list price was carefully formulated based on a consideration of the customer’s willingness to pay for the bundled enterprise value that Duet AI brings to the table.
The journey to this point began with Google discreetly accepting preorders for Duet AI for Google Workspace, setting the price at $30 per user per month back in May (the company later clarified that preorders began in June). Microsoft, shortly thereafter, unveiled its own pricing strategy in July, drawing attention to the intriguing coincidence of both tech giants aligning on the same pricing model.
Interestingly, the backdrop against which these developments unfold is the backdrop of differing revenue sources for the two tech giants. While Google primarily relies on internet search and online ads, Microsoft’s portfolio is more diverse, and heavily influenced by business software. The revenue generated by Google Cloud, which includes Workspace, and Google’s cloud infrastructure combined amounted to $8 billion in the second quarter. In comparison, Microsoft’s Office products and cloud services brought in a substantial $13.5 billion during the same period.
Despite these dynamics, Google has been making impressive strides. With 10 million paying customers and counting, Workspace’s popularity continues to surge. This growth is underscored by the fact that more than a million users have actively engaged with the new AI capabilities through a “trusted tester” program, which was initiated earlier this year. Over 1,000 customers are also presently partaking in a trial of these cutting-edge tools, further amplifying the impact.
The Duet AI technology is poised to redefine user experiences across various Google platforms. In Gmail and Google Docs, a simple text prompt can trigger Duet AI to generate a result. Google Slides users can now create images by merely typing descriptive text, while Google Sheets leverages Duet AI to outline project plans. Even in the realm of virtual meetings, Duet AI plays a role by taking notes during Google Meet sessions for those unable to attend in real-time.
Aparna Pappu, in a personal anecdote, shed light on the practicality of Duet AI. She recently utilized the technology to craft a product positioning document, pulling information from diverse sources, and create an illustration for a presentation—a testament to the potential of AI in streamlining complex tasks. Notably, the early adoption of Duet AI extends to brands like Adore Me, where employees are using the technology to enhance their workflow, particularly in the preparation of copy.
Microsoft, too, has been at the forefront of these advancements with their 365 Copilot. The company introduced a paid early access program for select clients in May, underscoring the competitive dynamics between the tech giants.
As the tech landscape evolves, more than 3 billion individuals worldwide are active users of Google Workspace. Anticipating further innovation, Google has projected the consumer version of Duet AI for Google Workspace to make its debut in the early months of the following year.
In a world where AI continues to shape and redefine our interactions with technology, Google’s move to introduce AI enhancements with a novel pricing model underscores the company’s commitment to pushing the boundaries of productivity and innovation. As businesses and individuals alike eagerly await the unfolding of these developments, it’s clear that the landscape of productivity software is poised for a transformative shift.