The company is facing a formal antitrust investigation in the United Kingdom over concerns that it may have misled customers about subscription options when it restructured its Microsoft 365 plans and bundled in an artificial intelligence tool.
The UK Competition and Markets Authority announced on July 29 that it has opened a probe into how the company communicated changes to its Microsoft 365 Personal and Family plans, specifically whether customers were given a clear and adequate explanation of what those changes meant for their pricing and features. At the center of the investigation is Copilot, an AI chatbot that Microsoft added to the plans, and the way that addition was rolled out to existing subscribers.
Initially, Personal and Family plan customers received access to Copilot at no additional cost. But when subscriptions came up for renewal, those same customers were automatically moved to a more expensive plan that included Copilot unless they actively selected a different option or chose to cancel their subscription entirely. The company also stopped making new Personal and Family subscriptions available without Copilot, narrowing the choices available to prospective customers.
A temporary option that raised more questions
In response to subscriber confusion, the company introduced a temporary plan called the Classic option, designed to allow existing customers to maintain the same features they had before the changes at the same price they had previously been paying. The plan provided a path for customers who did not want to pay more for Copilot access, but its availability was limited and temporary rather than a permanent part of the product lineup.
For subscribers on annual plans, the difference between the Copilot-inclusive Microsoft 365 Personal and Family plans and the Classic versions amounted to 25 pounds more per year, equivalent to roughly $33. For customers who did not closely follow the changes and were automatically rolled into the higher tier, the increase would have arrived without a clear expectation that it was coming.
The CMA’s investigation will focus on whether Microsoft adequately explained the differences between the available plans and the price implications of each before customers made decisions about whether to continue their subscriptions. The regulator will assess whether the company’s communications met the standard required under UK consumer protection law.
The broader context of AI bundling
The Microsoft investigation is part of a wider regulatory reckoning with how large technology companies integrate AI tools into existing products and what obligations those integrations create toward existing customers. When a company adds a new feature, prices that feature into a higher subscription tier and makes that tier the default for renewals, it changes the economic relationship with existing customers in ways that regulators in multiple jurisdictions have started to examine more closely.
The company has been aggressively expanding its Copilot integration across its product portfolio, positioning AI assistance as a core part of the value proposition of its cloud and productivity software. That strategy has commercial logic, but it also creates friction when customers who signed up for a particular product at a particular price find themselves being moved to a different price point as part of a rollout they may not have fully understood or anticipated.
What the investigation means for Microsoft
The CMA did not pre-judge the outcome of the investigation in its announcement, and no findings have been made. The regulator said it will examine the evidence and determine whether the company’s conduct violated the relevant consumer protection standards. If a violation is found, the CMA has the authority to require changes to business practices, impose financial penalties and negotiate binding commitments.
The company has not yet responded publicly to the investigation in detail. Companies that face CMA investigations typically engage with the process and have the opportunity to present their perspective on whether their disclosures met the legal requirements.
For Microsoft 365 subscribers in the UK, the investigation may eventually produce clearer standards around how they are notified about plan changes and whether automatic tier upgrades with price increases can be treated as the default renewal outcome.
