Microsoft Apologizes to Australian 365 Users on AI Pricing, Offers Refund

Microsoft has issued a proper apology to its 2.7 million Australian subscribers and supplied refunds following a authorized motion in opposition to the tech large alleging it intentionally hid cheaper subscription alternate options when bundling AI options with steep value will increase.

The apology, delivered Thursday by way of electronic mail to affected prospects, comes 10 days after the Australian Competitors and Client Fee filed authorized proceedings in opposition to Microsoft over the combination of its Copilot AI assistant into Microsoft 365 Private and Household plans final October.

Microsoft confirmed to subscribers that it launched AI capabilities into Microsoft 365 Private and Household subscriptions in response to demand for superior AI instruments, however acknowledged in its assertion that it “may have been clearer in regards to the availability of a non-AI-enabled providing with subscribers.”



“Our relationship with our prospects is predicated on belief and transparency, and we apologise for falling wanting our requirements,” Microsoft wrote within the electronic mail to subscribers.

The tech large has outlined two choices for subscribers in its assertion: keep on the present AI-enabled plan at $10-$12 (AU$16-$18) month-to-month, or change to Microsoft 365 Basic at $7-$9 (AU$11-$14) month-to-month with out Copilot. 

Clients switching to the Basic plan by the top of the yr will obtain refunds for the value distinction relationship again to their first renewal after November 30, 2024, the corporate stated. 

The ACCC had claimed in its submitting that Microsoft intentionally omitted point out of its cheaper “Basic” plans that retained authentic options with out Copilot at earlier costs, and is searching for penalties, injunctions, declarations, shopper redress, and prices from the corporate.

“Corporations ought to explicitly separate AI and non-AI pricing tiers at launch, in addition to state the professionals and cons of every to permit customers to make extra knowledgeable choices,” Joni Pirovich, Founder and CEO of agentic working system Crystal aOS, instructed Decrypt. 

“Value shouldn’t be an arbitrarily discriminating issue to AI adoption that would really profit customers,” she added.

Australian subscribers who want to stay on Microsoft 365 Private or Household with AI options don’t have to take any motion, the corporate wrote. On the similar time, these switching to the Basic plan should hold recurring billing enabled to keep up entry.

“We’ve been current in Australia for greater than 40 years, working on the ideas of belief and transparency,” the corporate stated. “We’ll be taught from this and enhance.”