Free AI vs Paid AI: Is your data really safe? What you NEED to know

I say this frequently (because it’s true), the fourth industrial revloution is upon us and just about everyone is trying to decode artificial intelligence for all sorts of reasons: curiosity, getting work done faster, making bigfoot vlogs, fear of job loss,..

We are told that by 2030, automation and AI are expected to reshape 22% of all jobs in the world - creating 170 million new roles and displacing 92 million  (WEF, 2025 p18). So to stand a fighting chance, we ought to start getting our heads around AI.

From drafting an email to your boss making a case for raise to complex AI-driven workflows auditing utility bills each month, spotting anomalies and suggesting cheaper tariffs; there is much potential (and anxiety).

Most pundits agree that the best place to start is listing the low level, repetitive time-suckers and then start using generative AI to get the task done better and faster (how exactly is a topic for anther day).

So we all need a generative AI tool.

There are lots to choose from: ChatGPT, Gemini, Claude, Grok, CoPilot, etc. But a question we hear constantly - including from an astute bursar at a recent ISBA webinar - is this:

"I've heard that free AI tools are now safer, and we can opt out of our data being harvested. Is that true?"

Let’s get into this.

The "Free" AI Myth: There's Often a Catch

Yes, some free AI tools have added privacy options (a recent occurance). But don't be fooled into thinking your data is automatically off-limits. Most free versions operate on a simple principle: you get the amazing AI power, and in return, your interactions often help make their models even better.

This means your prompts and the AI's responses could be used for training, reviewed by humans, or processed to refine the AI's future performance. While opting out is possible on some platforms, it's rarely the default.

You need to actively take control.

Quick Guide: Your Data Exposure & Costs at a Glance

Here’s a snapshot of common generative AI tools, how exposed your data typically is, and relevant pricing:

ProductFree Version: Data ExposurePaid Version: Data ExposureAction to Opt Out (Free)Action to Opt Out (Paid)Paid Version Price (Typical, per user/month)Education Discounts/Plans
ChatGPTHigh: Used for model improvement by default.Low: Usually not used for training (especially Enterprise).Yes: Settings > Data Controls > "Improve the model for everyone" (switch off).Yes (often default for Enterprise, same setting for Plus).Plus: ~£20Enterprise: Custom pricing. Reports of 10-20% off for bundled/long-term contracts for enterprises. No specific public education discount for Plus, but academic researchers can apply for free API credits.
Google GeminiHigh: Saved & used for model improvement by default.Moderate-Low: Better privacy; API usage often no-training.Yes: MyActivity > Gemini Apps Activity > "Save your Gemini Apps activity" (turn off).Yes (similar to free for Advanced, API terms are key).Advanced (via Google One AI Premium): ~£18.99Education Plus Discounts: Institutions purchasing over 25 licences or committing to multi-year agreements may be eligible for additional discounts.
Microsoft CopilotModerate-High (Consumer): Can be used for training.LOW (Enterprise/M365): Not used for training; data stays in your org.Yes: Manage "Optional Connected Experiences" in Microsoft settings.Yes (often default for org. accounts, managed by IT).Copilot Pro: ~$20 (consumer/individual) Copilot for M365: ~$30 (£20.78 UK) (requires M365 Business Standard/Premium or Enterprise/Edu licenses)Yes: Copilot for Microsoft 365 requires existing M365 A3 or A5 education licenses. Pricing for this add-on is specific to education tiers, e.g., ~£20.78 per user/month (annual commit) for eligible staff.
Perplexity AIModerate-Low: Focus on search, less on general training.Low: Strong commitments not to use user data for training.Limited: Core function is search.Generally Default: Policies usually prevent training on your data.Pro: ~$20 (or ~$16.67 billed annually)Yes: Student referral program can earn up to 24 months free.
ClaudeModerate: Not used for training unless you opt-in.Low: Strong "no training" default; logs for safety.N/A: Defaults to not using for training. Delete chats for history.Generally Default: Data not used for training. Delete chats.Pro: ~$20 (or ~$17 billed annually) Team: ~$25/user (min 5 users, billed annually)Enterprise: Custom pricing. No specific public education discounts, but direct contact for large-scale deployments advised.
DeepseekHigh: Policy indicates broad use for model improvement.Moderate-Low: Paid APIs might offer more control.Unclear/Limited: No obvious user-facing opt-out.Potentially via enterprise/API contracts.API (token-based): e.g., DeepSeek Chat 67B: ~$1 per million input tokens, ~$3 per million output tokens.Yes: "Freemium" tier for students/researchers providing full access to core AI functionality without cost for academic work. Low-cost options.
GrokHigh: Heavily linked to X (Twitter) data for training.High (likely): Still deeply integrated with X data.Yes: X (Twitter) settings > Privacy and safety > Grok > Deselect training.Yes (same as free, within X settings).Premium+ (via X): ~$16 (billed monthly for X Premium+) SuperGrok (rumored): ~$30Bulk Discounts: Organisations can inquire about bulk purchase discounts for Premium+ and SuperGrok plans.

For some products, especially paid tiers, you might see "API" mentioned. This refers to Application Programming Interfaces – essentially, a highly controlled and secure way for different software programs to directly "talk" to the AI model.

Think of it like this: Instead of you typing into a website, an API allows an app you already use (like a learning management system, a specific school admin tool, or even a simple no-code platform) to send requests to the AI and receive answers privately. This means your school could, for example, build a custom tool (often with no-code builders!) that sends anonymised policy drafts to an AI for review, keeping everything securely within your system, without anyone needing to be a programmer.

REMEMBER: Free AI is great for exploring, but if you value your privacy (or your organisation's data), you need to be proactive.

The "Paid" AI Promise: Your Digital Sandbox

Paid, especially enterprise-grade, AI tools offer what we call a "digital sandbox."

Your data goes in, the AI processes it, and then your data stays your data. It's not sucked into a global training pool. This is crucial for businesses, schools, and anyone dealing with sensitive or confidential information.

For example: Microsoft Copilot, when used with your school's Microsoft 365 account, means your data stays within your school's secure Microsoft environment. It's not used to train Microsoft's broader AI models. This is a game-changer for secure, compliant AI use.

But How Do AIs Get Smarter Without My Data?

A good question. AI companies are still making huge leaps forward without your specific inputs by:

Vast Public & Licensed Data:

They train on billions of pieces of publicly available internet data or carefully sourced, licensed datasets.

Brainy Algorithms:

Researchers constantly invent smarter ways for AIs to learn and think, independent of new data.

Expert Human Feedback:

Teams of humans test and refine AI responses using their own generated examples, not your private chats.

Our Simple Advice: Be Smart. Be Safe.

The Safehire.ai team believes AI should augment your decisions, not automate them blindly.

Free Tools:

- Use them for low-stakes, non-sensitive tasks.

- ALWAYS check your privacy settings and opt out of data training.

- And remember the golden rule: NEVER, EVER put sensitive personal or company data into a free public AI.

Paid Tools:

- For anything sensitive, complex, or critical to your operations, the paid versions are worth the investment.

- They offer the privacy and security you need for your data to remain your own.

Understanding these differences is key to harnessing AI's incredible power responsibly. Stay curious, stay informed, and keep making smart, safe choices with AI.

Important Disclaimer:

AI pricing models are dynamic and can change frequently. Education-specific discounts often require direct contact with the vendor's sales team and can depend on the size of your institution. This information is based on publicly available data as of late June 2025, but always confirm current pricing and specific terms directly with the AI provider.

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