Summary

• The CMA is investigating Microsoft’s marketing of Microsoft 365 Personal and Family plan changes.
• The probe examines whether customers were given clear information before renewal after Copilot-related features and higher prices were introduced.
• The case shows how AI bundling can be tested through consumer and competition rules, not only AI regulation.

Microsoft is under investigation by the UK Competition and Markets Authority over whether customers were misled about Microsoft 365 subscription options after Copilot-related features were added to Personal and Family plans.

The CMA is examining whether customers were given clear information before renewal about the plans available and the difference in cost. From January 2025, Microsoft automatically gave existing customers access to new features, including Copilot, at no extra cost for the rest of their subscription period. When those subscriptions ended, customers were rolled onto higher-priced plans unless they switched or cancelled.

Microsoft also introduced a time-limited option for existing customers to switch to “Classic” plans, which kept the previous feature set at the earlier price. For annual Microsoft 365 Personal and Family customers, the plan with additional features was £25 more than the Classic version.

Hayley Fletcher, senior director for consumer protection at the CMA, said: “When a business changes its subscription plans, customers need clear and timely information about their options. Our investigation will consider whether Microsoft customers were misled and ended up paying more as a result.”

The regulator has not concluded that Microsoft broke the law. However, the investigation places AI bundling into a familiar enforcement setting: subscription design, renewal transparency, default product changes, and whether customers understand the alternatives before a payment is taken.

The case is formally about consumer plans, although its logic reaches into the enterprise software market. Microsoft 365 is one of the dominant productivity environments for businesses, public bodies, charities, and education. As AI features are added to existing suites, vendors gain a powerful route to adoption through default placement, renewal cycles, and bundled value rather than standalone buying decisions.

That route can be commercially efficient, but it also attracts scrutiny when customers face changed prices or fewer visible alternatives. Regulators do not need to decide whether Copilot is useful to ask whether customers were told clearly what changed, what it costs, and what choices are available.

The CMA’s powers also raise the stakes. Since April 2025, it has been able to decide certain consumer-law breaches directly rather than going through the courts. It can fine companies up to 10 percent of global turnover if consumer protection law is infringed.

Australia’s competition regulator has begun proceedings over Microsoft subscription communications, while Italy’s competition authority is separately investigating whether Microsoft gave consumers enough information to assess changes and make an informed renewal decision. The pattern suggests that AI monetisation will be tested through existing consumer, competition, and subscription rules across several jurisdictions.

AI software will not be judged only on model performance or productivity claims. It will also be judged on invoices, renewal flows, defaults, and whether customers were given a fair chance to choose the product they actually wanted.