The only difference is that with the U1 when your phone is close to the Airtag it will tell you how far you are from the Airtag and show an arrow on the screen pointing in the direction of the Airtag. Without the U1 it will just tell you approx how far you are. Either way, you can make the Airtag beep to find it once you're within 10-20 feet of it.