The Competition and Markets Authority (CMA) has launched an investigation into Microsoft over concerns that customers may have been misled about changes to its Microsoft 365 subscription plans and ended up paying higher prices for extra features.
The investigation centres on changes Microsoft introduced to its Microsoft 365 Personal and Family subscriptions in January 2025, when it added new features, including its AI assistant Copilot.
Existing customers automatically received access to the new features at no extra cost for the remainder of their subscription. However, when their subscription renewed, they were automatically moved onto a higher-priced plan with the additional features unless they chose an alternative plan or cancelled their subscription.
Microsoft also stopped offering new customers the Personal and Family plans without the additional AI features.
For existing customers, Microsoft introduced a time-limited option to switch to a lower-cost “Classic” plan, which retained the previous features at the same price. Annual Microsoft 365 Personal and Family subscriptions with Copilot cost £25 more per year than the equivalent Classic plans.
The CMA will investigate whether Microsoft’s communications before renewal gave customers enough information about the available plans and price differences to make an informed decision.
The regulator stressed that it has not reached any conclusions on whether Microsoft breached consumer protection law.
The UK investigation follows similar action overseas. Australia’s competition regulator has launched legal proceedings against Microsoft over its communications with customers following the integration of Copilot into Microsoft 365 subscriptions, while Italy’s competition authority is investigating whether the company provided consumers with sufficient information about the changes to its subscription plans.
Under UK consumer protection law, companies found to have infringed the rules can be fined up to 10 per cent of their global turnover, or £300,000 where that amount is higher.
“People across the UK rely on Microsoft 365, whether they’re studying, sending emails or managing household finances,” said Hayley Fletcher, senior director for consumer protection at the CMA. “At a time when household budgets are squeezed, it’s important that people are clear on the price and the subscription plans available, so they can find the right deal for them.
“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.”
She added that as AI tools become more widely used, consumers should be able to access them through “fair and transparent practices” and understand when they have the opportunity to compare products.
