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The UK's Competition and Markets Authority (CMA) is investigating Microsoft over allegations that it misled customers regarding the price hike and added features to its Microsoft 365 subscriptions. This issue originated in January 2025, when Microsoft incorporated new features, such as Copilot, into its consumer package of Microsoft 365 subscriptions.

Subsequently, upon renewal, customers were automatically transferred to a higher-tier plan containing these features unless they opted to switch plans or terminate their subscription. Existing subscribers had the option to select a more affordable "Classic" plan without the new features. Retaining the Copilot-equipped plan resulted in a yearly price increase of £25.

The CMA is scrutinizing whether Microsoft's communications failed to provide customers with crucial information about their options, enabling them to make informed decisions. The regulator stated: "The investigation will examine whether customers were given key information about the plans and the difference in cost to understand the options available to them before making a decision."

A Microsoft spokesperson acknowledged the CMA's concerns, stating that consumer trust and transparency are priorities for the company. They are reviewing the claims in detail and remain committed to collaborating constructively with the regulator throughout the inquiry. When the change was documented last year, Microsoft also clarified how existing subscribers could switch to the more affordable Classic plan to avoid both the Copilot feature and the price increase.

The CMA expressed strong support for AI adoption and its potential benefits for individuals in the UK but emphasized that no one should be treated unfairly. The investigation is currently in its early stages, and the CMA has not determined if Microsoft breached consumer law.