Alphabet’s (GOOGL.O), opens new tab Google One subscription service, which charges consumers for cloud storage and artificial intelligence features, recently crossed 150 million subscribers, the company told Reuters.
That represents a 50% increase since February 2024, when Google One crossed 100 million subscriptions nearly six years after the service launched.
The same month, Google introduced a $19.99 a month plan with access to AI capabilities unavailable for free users. The company continues to offer Google One subscription tiers for file storage, but without most AI features, at lower prices.
The new AI tier accounted for “millions” of subscriptions, according to Shimrit Ben-Yair, a vice president at Google in charge of the subscription service.
Google One is part of Alphabet’s effort to diversify beyond advertising, which accounted for more than three-quarters of its $350 billion in overall 2024 revenue.
Alphabet’s success with subscriptions could play a key role in its long-term financial outlook as it grapples with the threat of AI chatbots, like OpenAI’s ChatGPT or Google’s own Gemini, to its search engine stronghold.
AI offerings caused a decline in searches on Apple’s (AAPL.O), opens new tab Safari browser for the first time ever, an Apple executive said during court testimony last week. The iPhone maker is looking to introduce AI-powered search options, a blow for Alphabet, which lost $150 billion in market value that day.
Unlike with search engines, AI interfaces have yet to find a seamless way to incorporate ads. Many companies are instead charging users through subscriptions or based on product usage.
Investors have questioned how Google will adapt.
“Just like you’ve seen with YouTube, we’ll give people options over time,” CEO Sundar Pichai said in February when asked efforts to monetize Gemini during an earnings call. “For this year, I think you’ll see us be focused on the subscription direction.”
Source: https://www.reuters.com/
