Microsoft has recently found itself in hot water with its 2.7 million Microsoft 365 users in Australia, leading the tech giant to issue an apology and propose refunds. This situation arose after the company faced legal scrutiny regarding its adjustments to subscription plans that incorporated its artificial intelligence (AI) tools.
On October 27, the Australian Competition and Consumer Commission (ACCC) initiated legal action against Microsoft. The regulator alleged that the company failed to adequately inform users about alternative and more affordable subscription options when it integrated its Copilot AI assistant into Microsoft 365 Personal and Family plans. These changes came with an increase in prices, raising concerns among consumers.
In an email to the impacted customers, Microsoft explained that the introduction of AI features was a response to an escalating demand for sophisticated tools. However, the company acknowledged that it “could have been clearer about the availability of a non-AI-enabled offering” for its subscribers.
To address the backlash, Microsoft has laid out two options for its subscribers. Users can either continue with the AI-enhanced plan, which is priced between $10 and $12 (AU$16–$18) monthly, or they can opt for the Microsoft 365 Classic plan, which ranges from $7 to $9 (AU$11–$14) per month and excludes the Copilot feature. Additionally, subscribers who choose to downgrade to the Classic version by the end of the year will receive a refund for the difference in pricing, with their first renewal after November 30, 2024, automatically reverting to the Classic version.
In another notable development, Microsoft recently collaborated with Arizona State University to create a virtual testing platform known as the “Magentic Marketplace.” This initiative showcases the company”s efforts to innovate within the tech landscape.
