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Charging you for Galaxy S24 AI features is a dumb mistake Samsung won’t make

The Galaxy S24 series is rumored to be big on generative AI. It is clear that this is going to be a key area of focus for manufacturers in 2024. Qualcomm’s latest Snapdragon 8 Gen 3 chipset, which will also be used for the Galaxy S24 series, comes with a whole host of generative AI features in the device. Samsung’s answer to this chipset, the Exynos 2400, will have similar functionality.

These new chipsets will be used in the Galaxy S24 lineup early next year. As a result, they will deliver enhanced AI experiences on devices, enabling you to use AI offline and fully on-device. A wild rumor claims Samsung is considering paying customers to use the Galaxy S24’s AI features, but here’s why I think it’s a dumb mistake the company probably won’t make.

The rumor remains completely unsubstantiated. There’s no evidence at this point that Samsung plans to offer a subscription service next year that will unlock the Galaxy S24’s advanced generative AI features for customers. First, the optics are terrible. If the price doesn’t increase, the Galaxy S24 Ultra will start at $1,199. Imagine paying that much for a new flagship phone and then having to pay a monthly fee to unlock some of its features!

The biggest advantage of on-device generative AI is in the name itself. It runs entirely on the device so features can be accessed offline and the company doesn’t have to pay for expensive processing in the cloud to support the feature. Take ChatGPT for example. It does everything in the cloud from the moment you prompt it. OpenAI, the company that runs it, spends $700,000 a day just to keep the service running. Naturally, OpenAI will eventually want to improve its business models to support this burn rate with the billions in VC funding it has raised.

LLM or large language models that can run on devices are the solution to this expensive problem. Simply put, these are super smart algorithms that have access to a large dataset that they can use to generate content based on given prompts. Qualcomm Mater demonstrated the on-device AI capabilities of Snapdragon 8 Gen 3 using the open-source Lama 2 LLM, and the chipset is capable of running 10 billion parameters on the device.

Manufacturers have the option of using such plug-and-play solutions or using their own LLM. If Samsung opts for the former, where it offers any kind of on-device AI chatbot on the Galaxy S24, using an algorithm and dataset maintained by Meta, what would it charge a subscription fee for? Features like Stable Diffusion, which makes it possible to create images based on sound prompts, also use similar third-party AI models.

Qualcomm also demonstrated the Snapdragon 8 Gen 3’s ability to remove objects from video. This AI feature relies on video object erasure technology developed by Arcsoft. The fragmented nature of the AI industry means that manufacturers like Samsung have to work with different partners to deliver different AI features to their devices. The other option is to build each LLM, dataset, and AI feature ourselves, which would unnecessarily complicate matters, even if it justifies charging a subscription fee for the features.

Any move to put AI features for smartphones behind paywalls is going to be very counterproductive in my view. 2024 will be the first year where AI will be at the heart of new phones. Manufacturers need to put a lot of effort into making sure that consumers understand what AI can help them with in their devices. Average users who don’t understand what LLM is or what they can do with Stable Diffusion won’t even bother trying out these features if it costs them a monthly fee just to unlock the features.

It’s also likely that for most users, the novelty of these features will wear off once the honeymoon period of a new phone is over. For example, how often do you imagine that an average user relies on static diffusion to create images? Why would they bother paying for features they either don’t understand or don’t have a strong reason to use every day?

We’ve often talked about Samsung’s lack of a solid subscription business compared to Apple. No wonder Apple’s services revenue hit a record $22.3 billion in Q4 2023. Imagine that for a second It’s making more than $22 billion in a single quarter from Apple Music, Apple TV, Arcade, the App Store, News+ and other services.

There’s no question that Samsung messed up by failing to see the brilliance in Apple’s plans as the latter moved to expand its subscription-based revenue, ensuring that even if hardware had a sluggish quarter, there was a whole other business ready to support and expand the bottom line. Line It’s admirable if Samsung wants to build a similar moat around its business now, but it’s far from a smart idea to try and make customers pay for AI features on the Galaxy S24.

Circling back to the point about optics. Every single flagship phone maker will talk about how their phone’s on-device generative AI capabilities are better than the competition. Does Samsung really want to support their marketing efforts by telling them that their AI capabilities are not only good, but also free unlike Samsung? Case in point, the new flagship phone Xiaomi teased at the Snapdragon Summit last month, comes with Snapdragon 8 Gen 3’s on-device AI features. It is not charging users to access any of these features.

These are some of the reasons why I think Samsung won’t make the dumb mistake of charging people to use the Galaxy S24’s AI features. I trust that this unsubstantiated rumor will be nothing more than a rumour. There hasn’t been the slightest hint from Samsung that it’s considering the concept, so anyone looking forward to the Galaxy S24 series can rest assured, you’ll be able to tap into its full potential without paying a monthly fee.

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