The Australian Competition and Consumer Commission (ACCC) has alleged that the technology giant has misled roughly 2.7 million customers since October 2024 by suggesting they had to move to higher-priced Microsoft 365 personal and family plans that included its AI tool, Copilot.
Auto-renewing subscribers were reportedly told they had two choices – accept the Copilot integration with higher prices, or cancel their subscription entirely, according to the ACCC.
The regulator claims this was misleading on Microsoft’s part because a third option existed, which was that Microsoft 365 Personal and Family ‘Classic’ plans retained all original features without Copilot at previous lower prices.
“Following a detailed investigation, we will allege in Court that Microsoft deliberately omitted reference to the Classic plans in its communications and concealed their existence until after subscribers initiated the cancellation process to increase the number of consumers on more expensive Copilot-integrated plans,” said ACCC chair Gina Cass-Gottlieb, via a statement.
“The Microsoft Office apps included in 365 subscriptions are essential in many people’s lives and given there are limited substitutes to the bundled package, cancelling the subscription is a decision many would not make lightly.”
The claim also states that the option to keep the cheaper plan was only revealed after consumers started the cancellation process, which reportedly creates a false impression and breaches Australian consumer law. The ACCC said Microsoft’s previous communications through emails and a blog post fail to mention the cheaper alternative.
The ACCC said it is seeking orders including penalties, injunctions, declarations, consumer redress and costs.
Cass-Gottlieb added: “We’re concerned that Microsoft’s communications denied its customers the opportunity to make informed decisions about their subscription options, which included the possibility of retaining all the features of their existing plan without Copilot and at the lower price.
“We believe many Microsoft 365 customers would have opted for the Classic plan had they been aware of all the available options.”
Microsoft is also facing a lawsuit in the US, where eleven ChatGPT Plus subscribers are alleging the company artificially inflated ChatGPT prices while building competing AI products.
A Microsoft spokesperson told Reuters it was reviewing the ACCC’s claim in detail.
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After a standout 2025 edition, we’re back with an even sharper focus on the intersection of data centres, energy, and ESG. As power demand rises and regulations evolve, there’s a growing urgency to rethink how infrastructure is powered, financed, and built for long-term impact.
