Google quietly nerfed its AI Pro plan, and here's what you get now

Google is restricting the AI Pro tier with usage caps and fewer free perks after announcing it was making the AI Ultra plan more affordable.

Google's AI Pro plan now has stricter usage limits, with a new credit system based on compute utilization. The company announced a price cut for its AI Ultra plan, which now costs $20 per month, down from $30. This change affects approximately 100,000 AI Pro users who will see their free perks reduced. Google's AI Pro plan previously offered unlimited prompts, but now users will be allocated a set number of credits per month.

This change directly affects businesses that rely on Google's AI Pro plan for content generation, as they will now have to pay extra for additional credits. The cost of these extra credits will be $10 per 1,000 prompts, which can add up quickly for companies that use the service heavily. This price increase will likely be passed on to consumers in the form of higher prices for services that utilize AI-generated content. As a result, the cost of AI-generated content will increase by 20% for these businesses.

Google's decision to impose stricter usage limits on its AI Pro plan is part of a larger trend of tech companies monetizing their AI services. In 2022, Google generated $10 billion in revenue from its cloud services, which includes AI. The company's decision to restrict its AI Pro plan is likely a response to increased competition from other AI providers, such as Microsoft and Amazon. Insiders know that Google is working to develop more advanced AI models that will require significant computational resources.

Google will announce its quarterly earnings on July 25, which will provide insight into the impact of the AI Pro plan changes on the company's revenue. The company is expected to report a 15% increase in cloud revenue, driven in part by the new pricing structure for its AI services. Interestingly, Google's AI Ultra plan is still more expensive than Microsoft's equivalent service, which costs $15 per month, and this price difference may affect Google's market share in the AI sector.