Morgan Stanley: Apple Intelligence Becoming Increasingly Important to iPhone Owners

Consumers’ perception of Apple’s artificial intelligence (AI) platform is more favorable than that of investors, Morgan Stanley said in a research note released Tuesday (April 22).

In the note, which the company provided to PYMNTS, Morgan Stanley said it found that the Apple Intelligence platform has been downloaded and engaged with by 80% of eligible U.S. iPhone owners in the last six months, has an above average net promoter score of 53, and is characterized by iPhone users as “easy to use, innovative, and something that improves their user experience.”

“While much of the public critique of Apple Intelligence is warranted, and investor sentiment and expectations on Apple’s AI platform couldn’t be lower, our survey of iPhone owners paints a more positive picture,” Morgan Stanley said in the note.

The survey also found that since September, the share of iPhone owners who believe it is extremely or very important to have Apple Intelligence support on their next iPhone rose 15 points to reach 42%. Among iPhone owners who are likely to upgrade their device in the next 12 months, the percentage saying that about the AI platform rose 20 points to reach 54%, according to the note.

Morgan Stanley also found that consumers are willing to pay more for Apple Intelligence than they were in September. Those who have used the AI platform are now willing to pay an average of $9.11 per month for it, a figure that’s 11% higher than the $8.17 average seen in September, per the note.

“While we don’t expect Apple to put Apple Intelligence behind a paywall until the platform is more built out, the potential long-term monetization of an Apple Intelligence subscription could reach tens of billions of dollars annually when considering a 1.4B global iPhone installed base, 32% (and growing) of US iPhone owners have an Apple Intelligence support iPhone, and users are willing to pay up to $9.11/month for Apple Intelligence,” Morgan Stanley said in the note.

Apple announced its suite of AI features in June, saying Apple Intelligence would revolutionize the iPhone,Mac and iPad experience, while keeping user data safe.

The rollout of the offering over a period of months experienced some hiccups, including complaints that its AI summary tool was generating inaccurate headlines, leading Apple to remove the feature from its operating system.

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