What Happened with Microsoft’s Prices
Microsoft is facing a huge issue in Australia. The nation’s consumer protection group states the technology giant was not truthful with consumers about their options. When Microsoft introduced a new feature called Copilot to its Microsoft 365 subscriptions, prices skyrocketed. Individuals who subscribed to the personal plan saw their annual cost climb from approximately $110 to $159. Individuals on family plans began paying $179 rather than $139. A whole lot of money for something they may not even need.
Microsoft never informed people that they could simply stay with their old plan without Copilot at the cheaper price. 2.7 million customers received emails stating prices were increasing. But in those emails, Microsoft never mentioned the cheaper alternative still remained available. People felt that they had no other option but to pay more or to cancel everything. The watchdog states that this is against the rules because businesses must be transparent about what choices customers really have.
How Customers Discovered the Truth
The only way people were able to find out about the lower plan was by attempting to cancel. When one followed the steps to cancel their subscription, that’s when Microsoft finally revealed that they could remain on the old plan. The watchdog believes this was done intentionally in order to have more people paying a higher cost. Microsoft forwarded blog articles and emails regarding the changes but never included the most significant detail.
What’s Next for Microsoft
Microsoft might end up having to pay some hefty fines if the court rules in Australia’s favor. The law in the country states that firms can be slapped with a penalty of up to $50 million each time they violate rules. Microsoft could also have to refund customers who paid extra without realizing they had another option. Currently Microsoft maintains that they are investigating what the watchdog is alleging, but they haven’t actually described their side of things as yet. All of this demonstrates why large corporations ought to be honest with people regarding expenses and options, particularly when millions of people are involved.
News At Glance
- Australia’s government auditor sued Microsoft for keeping cheaper subscription plans under wraps when they increased prices a year ago.
- Personal Microsoft 365 plans rose 45% to $159 a year and family plans increased 29% to $179 after including Copilot features.
- Nearly 2.7 million Australians never were informed they could continue to use their older lower-cost plans without the new features.
- Microsoft could be fined $50 million per violation and must refund money to customers who overpaid.
FAQs
Q1: Why is Microsoft being sued in Australia?
They did not inform customers of lower-priced plans when rates increased, leading consumers to believe that they needed to pay more or leave.
Q2: How much additional money did customers have to pay?
Personal plans increased from $110 to $159 annually, and family plans increased from $139 to $179 per year.
Q3: When did all this begin?
October 2024 is when Microsoft increased the prices and included the Copilot tool on subscriptions.
Q4: What does Australia want Microsoft to do?
Pay fines, return customers’ money, and refrain from conducting business this way in the future.
Q5: Were less expensive plans really offered the entire time?
Yes, but Microsoft didn’t talk about them until customers attempted to cancel, not when communicating regularly.
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