Regulators Claim 2.7 Million Users Were Overcharged After AI Copilot Rollout
Microsoft is being sued in Australia after the Australian Competition and Consumer Commission (ACCC) accused the company of misleading around 2.7 million consumers about the new Microsoft 365 subscription plans that include the Copilot AI assistant, Reuters reports.
The regulator argues that Microsoft implied customers had to switch to the new Personal and Family plans to continue using the service, without clearly disclosing a cheaper Microsoft 365 Classic option that excludes Copilot.
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This lower-priced alternative was only revealed when users tried to cancel their subscriptions — a move the ACCC says breaches national consumer protection laws.
The new pricing took effect on October 24, raising the annual Personal plan by 45% to AUD 159 (about USD 103), while the Family plan increased by 29% to AUD 179.
The commission is seeking fines, compensation for affected customers, and coverage of legal costs from Microsoft Australia Pty Ltd and its U.S. parent company. Under Australian law, penalties can reach AUD 50 million per breach, or alternatively, three times the benefit gained or 30% of adjusted turnover, whichever is greater.
The case could set an important precedent for how global tech companies communicate pricing transparency and AI-related upgrades to consumers.
Photo: IT News
