Microsoft To Refund Australian Users Over 365 Price Hike Following Legal Action: Report

Microsoft has announced it will refund Australian customers who paid higher fees for its Microsoft 365 subscriptions after a price increase linked to its Copilot AI features, provided they opt to switch back to their original, lower-cost plans, as per ABC.

The move comes in response to legal proceedings initiated by the Australian Competition and Consumer Commission (ACCC), which alleges the tech giant misled around 2.7 million users by concealing cheaper subscription options.

Microsoft has issued an apology, admitting it could have communicated the pricing changes more clearly when they were introduced in October 2024, the report further added.

As per ABC report the company wrote to customers on Thursday in order to apologise to those affected, saying it "fell short of our standards" and could have "communicated more clearly when we changed our pricing in October 2024".

"In response to the demand for advanced AI tools, we introduced AI capabilities into the Microsoft 365 Personal and Family subscriptions that we offer in Australia," ABC said citing the company’s statement.

"In our email to subscribers, we expressed our regret for not being clearer about our subscription options, shared details about lower-priced alternatives that come without AI and offered a refund to eligible subscribers who wish to switch,” ABC further wrote citing the company statement.