Microsoft is reaching out to millions of Australian customers with formal apologies following backlash over its subscription pricing. In the emails being sent, the company admits that it hadn’t clearly communicated cheaper options for Microsoft 365 Personal and Family plans. The messages also explain how customers who renewed in 2024 can request a refund.
The apology follows an announcement from the Australian Competition and Consumer Commission (ACCC), which has launched legal action against Microsoft. The regulator alleges that the company misled around 2.7 million Australian customers by promoting higher-priced Microsoft 365 plans featuring the Copilot AI assistant.
The regulator argues that customers never really had a fair choice. Most were funneled into the new, more expensive Microsoft 365 plans that came with Copilot. Those who tried to cancel were offered what seemed like a middle ground, a “Classic” version of their old plan, minus Copilot, but still at the same cost. What they weren’t told was that the Classic plans were quietly being sold elsewhere for much less.
Facing mounting criticism, Microsoft has acknowledged its misstep. The company said it should have been more transparent about the non-AI version of its subscription, admitting that the information wasn’t shared widely with customers outside the cancellation process.
To make things right, Microsoft is now emailing roughly three million Aussie customers to tell them about the cheaper “Classic” plans. The ACCC says that kind of transparency should’ve been there from the start, not after people had already renewed.
As part of its remediation, Microsoft is offering refunds to customers who renewed their subscriptions after November 2024. Those affected can either stay on their current Copilot-enabled plan or switch to a cheaper “Classic” version and receive a refund for the difference.
In its statement, Microsoft pointed to its forty-year presence in Australia, saying it has always aimed to operate “with trust and transparency.” The company admitted it fell short of that standard and said it regretted the circumstances that led to the ACCC’s investigation.
With Microsoft’s apology issued, the next move belongs to the ACCC. The regulator will soon decide if it will push ahead with the case, one that could cost the company up to 30 percent of the revenue it earned while the breach took place.
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