Google has announced that it will be making its AI features in Gmail and Docs free for all users, a move that is expected to heat up the B2B AI wars with Microsoft and OpenAI. Previously, users had to pay an additional $20 per user per month for the Gemini Business plan to access these features. However, this change comes with a catch - the price of all Workspace plans will be increased by roughly $2 per month per user.

The AI features, which are part of the Workspace AI suite, include email summaries in Gmail, generated designs for spreadsheets and videos, an automated note-taker for meetings, the powerful NotebookLM research assistant, and writing tools across apps. Users will also have access to the Gemini bot, which can perform tasks such as finding information, searching across all content, and more.

According to Jerry Dischler, Google's president of cloud applications, the company is making this move to remove the cost barrier that has been hindering the adoption of AI features by businesses. "Most of the time, when we talk to companies who are using AI, their big impediment is cost reasons," he said. "That's why they go in so gingerly. Like, 'wow, this is a lot of money, and let's prove the value.' All right, now you get the AI. You have the value."

This move is seen as a strategic play by Google to gain an edge in the B2B AI market, which is becoming increasingly competitive. Microsoft recently announced that its Copilot Pro AI features, which were previously a $20 monthly upgrade, would become part of the standard Microsoft 365 subscription. However, Google's move is more comprehensive, making its AI features available to all users, regardless of their subscription plan.

The implications of this move are significant, as it could lead to a wider adoption of AI features by businesses. With the cost barrier removed, companies may be more likely to experiment with AI and integrate it into their workflows. This could lead to increased productivity and innovation, as well as new opportunities for businesses to differentiate themselves.

Google's decision to increase the price of Workspace plans may be seen as a necessary evil to offset the cost of making its AI features free. However, it remains to be seen how this move will be received by users, particularly those who are on lower-tier plans. The company will need to balance the need to generate revenue with the need to provide value to its users.

In the long run, Google's move could have significant implications for the future of work and productivity. As AI becomes more ubiquitous, it could lead to new ways of working and collaborating, as well as new opportunities for businesses to innovate and grow. With this move, Google is positioning itself as a leader in the B2B AI market, and it will be interesting to see how its competitors respond.