Unexpected Move: Google Cuts AI Plus Subscription Price and Doubles Storage

The price war in AI tools is beginning, Google has decided on its own initiative to cut the price of its AI Plus plan from 30 shekels to 19 shekels and, at the same time, double the storage included in the subscription. According to experts, this is an initial step toward a broader price reduction for a product that is becoming a basic consumer item. At the same time, the company will limit the amount of credits included in subscriptions, though users may not feel it.

Yonatan Apelett, mako, published: 10.06.26, 12:23.

We are already used to living in a world where everything keeps getting more expensive, including our subscriptions to digital services such as Netflix or Spotify. It is a familiar practice, get consumers hooked on a cheap and good product, even at a loss, and then gradually raise prices. Now, Google has announced the opposite, a move that may signal the start of a price war in AI. The company sent emails, including in Israel, about reducing the monthly price of the AI Plus subscription from $7.99 to $4.99, in Israel from 30 shekels to 19 shekels a month, and on the annual plan from 300 shekels to 190 shekels. At the same time, it doubled the storage included in the subscription from 200 GB to 400 GB, a move that could also benefit users who chose the Pro subscription and do not really need more than 400 GB.

However, Google wrote in the email to those consumers, "We are moving to a new formula for calculating credit quotas in the Gemini app. This formula takes into account the complexity of prompts, the features used and the length of conversations. The quota resets every 5 hours until the weekly cap is reached. With an AI Plus subscription like yours, you can enjoy a usage quota twice as large as users without a subscription." Google added, "We intend to launch this usage quota model in other products as well, starting with Flow and Antigravity. Although the benefits in your basic plan will no longer include 200 AI credits each month, the new quota model we are launching will allow you to maintain the same user experience you are accustomed to."

Advertisement. Vikas Kansal, product manager for Gemini AI subscriptions, wrote on X that the storage update will roll out to users in the coming days, some have already received it.

AI Plus was launched in January as the cheapest AI subscription on the market, and is intended for private users and students. The plan includes video creation with Omni Flash, Google Flow, the creation studio, and the research assistant NotebookLM. Google also offers AI Pro and AI Ultra at higher prices, but with more storage and more AI tool credits. In the past, the company also increased the storage capacity of AI Pro subscriptions from 1 TB to 5 TB at no extra cost.

Does this mean that consumers with the same subscription will now run into a token limit? It may, but it is hard to know, and it depends on each person’s personal use. If you are not a heavy user, you probably will not notice a difference. If you are a heavy user, you probably bought a more expensive subscription to begin with.

It should be noted that Google is perhaps the company for which it is easiest to cut prices. In the end, it is a massive tech corporation that lives on our data, the more subscriptions it has, the more information it has. Lowering the price can even pay off if it succeeds in stealing customers from a rival. The price cut is part of a price war that began in emerging markets around the world. In August last year, OpenAI launched ChatGPT Go in India at about $4.60 a month, which costs about 25 shekels in Israel. In December, Google launched its own AI Plus subscription in India for less than $5.

Advertisement. Chi-Hua Chien, co-founder of the venture capital fund Goodwater Capital, told TechCrunch that the move marks the era of commoditization in AI infrastructure. "If you look at the internet era, the infrastructure companies were Microsoft, Cisco, Oracle, Northern Telecom, Lucent, Akamai and Equinix," he said. "A lot of those companies survived for a while, but they are not worth much today."

According to him, in every major technological shift, infrastructure companies "are aggressively commoditized, because the end customer does not think, 'Wait, are my bits going through Cisco equipment?' He thinks, 'How do I move my bits as cheaply as possible?'" Chien predicts that in the long term, companies like OpenAI and Anthropic, as well as chip, energy and storage providers, will undergo a similar process.

Both OpenAI and Anthropic have recently filed confidential applications for an initial public offering and are facing a major change in their corporate nature. Cheaper subscriptions can swell their monthly user numbers and, of course, affect the stock price. The price war over AI tools is expected to deepen as those companies have to prove their financial success.

AI, OpenAI, Anthropic, artificial intelligence, Google.