Microsoft’s AI Subscription Prices Probed by UK Regulator

Regulators in the United Kingdom are investigating whether Microsoft misled customers about its subscription options pricing, according to a Wednesday (July 29) press release.

The investigation comes in response to concerns that consumers might not have been given clear information about subscription options when Microsoft changed its Microsoft 365 Personal and Family plans, the U.K.’s Competition and Markets Authority said in the release.

“When a business changes its subscription plans, customers need clear and timely information about their options,” Hayley Fletcher, the CMA’s senior director for consumer protection, said in the release. “Our investigation will consider whether Microsoft customers were misled and ended up paying more as a result. As people rely more and more on AI tools like Copilot, it’s important that everyone is able to access these through fair and transparent practices and understand when they have the opportunity to shop around and make choices about which products they want to use.”

Microsoft last year automatically began giving customers access to new features like Copilot for no added cost for the remainder of their subscription period, according to the release. When that period ended, customers were automatically placed on a plan with the new features at a higher price, unless they canceled or picked another plan.

Microsoft offered Personal and Family plan customers a limited-time option to switch to a Classic plan, offering the same features as before at the same price, per the release. For annual Microsoft 365 Personal and Family Plan customers, the plan was 25 pounds (about $33) a year more than the Classic version.

“The CMA is looking into whether Microsoft’s communications with customers before renewal were misleading,” the release said. “The investigation will examine whether customers were given key information about the plans and the difference in cost to understand the options available to them before making a decision.”

The CMA has not yet concluded whether Microsoft broke the law, according to the release.

“Consumer trust and transparency are priorities for Microsoft, and we are reviewing the CMA’s claims in detail,” a spokesperson for the company said in a statement to PYMNTS. “We remain committed to working constructively with the regulator as their inquiry progresses.”

PYMNTS Intelligence found that among consumers who use a dedicated AI platform for at least one task, 30% reported using Copilot, compared to 83% for OpenAI’s ChatGPT and 48% for Google’s Gemini.