Australia’s ACCC Takes Microsoft to Court Over Misleading Subscriptions

Australia’s competition watchdog, the Australian Competition & Consumer Commission (ACCC), has filed lawsuit proceedings against Microsoft, accusing the tech giant of misleading approximately 2.7 million customers over its Microsoft 365 subscription plans.

According to the ACCC, starting from October 2024, Microsoft bundled its artificial-intelligence tool “Copilot” with its Microsoft 365 Personal and Family plans and raised prices substantially — by around 45% for the personal plan and 29% for the family plan. The regulator claims that Microsoft’s communications gave users only two apparent options: accept the higher-priced Copilot-bundled plan, or cancel their subscription.

The ACCC further alleges that Microsoft failed to clearly inform customers that a cheaper “classic” version of the subscription — without Copilot — was still available. That option, it says, only became evident during the cancellation process, which the regulator argues deprived users of an informed choice.

Microsoft has stated it is reviewing the ACCC’s claims in detail. The regulator is seeking penalties, consumer redress, injunctions and reimbursement of legal costs. Under Australian consumer law the maximum penalty for each violation may be A$50 million or more, depending on outcomes.

Source:

• Reuters — Australia’s ACCC takes Microsoft to court, says it misled approx. 2.7 million customers