Caution! Microsoft transfers 365 customers to more expensive subscription model
In Australia and several other countries, there is a significant price increase for 365 subscribers. Only those who pretend to cancel can stay on the old tariff
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Microsoft 365 subscribers in Australia and several other countries are currently reporting massive price increases. This is due to a supposedly compulsory, more expensive new subscription model with new AI functions in the 365 applications. Microsoft apparently wants to transfer all old 365 subscriptions in the affected countries to this model. Customers do have the option of staying with their cheaper old subscription model. However, Microsoft is apparently consistently concealing this. Consumer advocates are sounding the alarm.
Many users were caught off guard
Microsoft had already announced price increases for numerous products in November. While this mainly concerns business applications and therefore primarily affects companies, private users in Australia, New Zealand, Malaysia, Singapore, Taiwan and Thailand are now being affected.
The background to this is the introduction of the AI applications Microsoft Copilot and Microsoft Designer. Copilot is an AI chatbot based on the ChatGPT 4 AI model from OpenAI. Designer is an AI-supported software for graphics and image editing. Microsoft had already announced this project in a press release at the beginning of November and also mentioned corresponding price increases. Many users in the affected region probably didn't have this on their radar – and have now been caught off guard.
365 price increase can be avoided
As Microsoft also announced, the new software package – with AI applications and higher prices – will be introduced for all subscribers to 365 Personal and the 365 Family group subscription at the next automatic renewal. Subscribers to 365 Personal in New Zealand, for example, will then pay 179 New Zealand dollars (equivalent to just under 98 euros) per year instead of the previous 129 dollars. Those with 365 Family will then pay 229 dollars (125 euros) instead of the previous 179 dollars. However, as a Mastodon user and the New Zealand magazine Consumer report, there is a well-hidden way to avoid the higher prices and new programs: In which customers pretend to want to cancel.
As Consumer reports, users have to go to the account area on the Microsoft website and click on "Cancel subscription" under "Subscription". Then – and only then –, according to the Consumer report, a menu opens in which the "Microsoft 365 Personal Classic" subscription model is suggested as an alternative to the existing – subscription, which has already been automatically transferred to the more expensive new model –. At 129 dollars per year, the Classic subscription is significantly cheaper than the regular "Microsoft 365 Personal" variant.
The hidden opt-out also works for new customers. However, they must first take out a subscription at the new (higher) prices in order to then also select the cancellation option as described above and be offered the Classic subscription. According to Consumer, anyone who bought their subscription at the old retail prices will not be affected by the price increases until the end of their subscription. Those who bought their 365 subscription via an external app store will be left out in the cold. According to Consumer, they only have the option of canceling the subscription and taking out a new one directly with Microsoft.
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Anger about a lack of transparency
What Consumer criticizes and causes a lot of resentment on Mastodon is Microsoft's lack of transparency towards its customers on the subject. Consumer speaks of a breach of trust and a clear case of a "dark pattern". The latter describes the tactic of using a misleading user interface to force customers to make decisions that they would not normally make. Several users on Mastodon suspect that Microsoft is acting illegally, and one user has reportedly filed a complaint with the Australian Consumer Protection Agency.
The developments in the affected region could be a foretaste of what could also affect 365 customers in this country. The development of AI applications is generally costly, even for Microsoft. The company is now apparently trying to generate additional revenue by increasing prices. At the same time, customers are to be persuaded to use the new AI-supported software. However, the current approach is also likely to be a test to see how customers and regulatory authorities react.
The governments of numerous countries are also using the 365 software, including Germany. The German Informatics Society (Gesellschaft fĂĽr Informatik, GI) recently voiced massive criticism of the German government's decision to remain dependent on Microsoft. It sees the danger of Germany becoming a "digital colony".
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