Australia’s consumer watchdog, the ACCC, has filed legal action against Microsoft, alleging that millions of Australians were misled by the company’s communications about changes to its Microsoft 365 subscriptions. Many residents in our community received an email today (6 November 2025) outlining these changes and the options now available to them, following mounting consumer concern and the ongoing court case.
What Happened?
The ACCC alleges that Microsoft’s marketing of its subscription updates in late 2024 led many to believe their only path forward was to accept a price rise or cancel altogether, without clearly informing users about a more affordable, alternative plan: Microsoft 365 Personal Classic and Microsoft 365 Family Classic. The dispute centres on the company’s October 2024 announcement, which raised the cost of Microsoft 365 subscriptions and included new features—most notably, access to Microsoft’s AI assistant, Copilot (a generative artificial intelligence chatbot replacement for the discontinued Cortana). However, consumers were not made clearly aware they could continue at the older price via alternative Classic plans, and the court will determine whether this omission breached Australian Consumer Law.
Timeline of Events
- 31 October 2024: Copilot added to plans, prices increased
- January 2025: Consumer complaints escalated
- 28 October 2025: ACCC filed Federal Court proceedings
- 6 November 2025: Microsoft sent apology emails to subscribers
- 31 December 2025: Deadline to switch to Classic plans for refund
Why Was the Email Sent?
Microsoft says the recent email reflects its commitment to clarifying your options and correcting any confusion. The company acknowledges it “could have been clearer” earlier and now wants to ensure subscribers are aware that:
- You can stay on your current Microsoft 365 plan and pay the new annual price
- You can switch to the Microsoft 365 Classic plan at the previous lower price
- Eligible subscribers in Australia who switch before 31 December 2025 will get a price difference refund for renewals after 30 November 2024
Your Options Explained
Here is what each plan offers and what’s missing from the lower-priced option:
For Individual Users
| Plan Name | Annual Cost (AUD) | Included Features | What’s Missing Compared to Standard Plan |
|---|---|---|---|
| Microsoft 365 Personal | $159 | Core Office apps, Copilot AI assistant, ongoing new feature updates | – |
| Microsoft 365 Personal Classic | $109 | Core Office apps (Word, Excel, PowerPoint, Outlook, OneDrive), security updates | No Copilot; no ongoing new feature updates |
For Households
| Plan Name | Annual Cost (AUD) | Included Features | What’s Missing Compared to Standard Plan |
|---|---|---|---|
| Microsoft 365 Family | $179 | Core Office apps for up to 6 people, Copilot AI assistant, ongoing new feature updates | – |
| Microsoft 365 Family Classic | $139 | Core Office apps for up to 6 people (Word, Excel, PowerPoint, Outlook, OneDrive), security updates | No Copilot; no ongoing new feature updates |
Microsoft 365 Personal/Family: These are the fully-featured subscriptions. They give you not only the main Microsoft applications (Word, Excel, PowerPoint, Outlook, OneDrive) but also Microsoft’s Copilot AI assistant and regular updates with new features as they’re introduced. The prices are $159 per year (Personal) or $179 per year (Family). If you do nothing, you’ll stay on these plans.
Microsoft 365 Personal/Family Classic: These versions provide all the main Office applications and security updates, but you won’t get Copilot or new features after your switch. The prices remain $109 per year (Personal) or $139 per year (Family)—what many of us paid before the recent increase.
Important: If you want to switch and continue using Microsoft 365 Classic after switching plans, you must keep recurring billing enabled (auto-renewal turned on).
How to Switch to a Classic Plan
If you’ve received the email and want to switch to the Classic plan:
- Log into your Microsoft account at account.microsoft.com
- Go to your Services & subscriptions section
- If you haven’t had your subscription renewed since 8 July 2025, you may be able to select the cancel option and follow the steps in the cancellation process until the Classic plan is offered
- Alternatively, follow the specific instructions in the email you received
- Keep recurring billing active to maintain access to the Classic plan
Remember: You must complete this switch by 31 December 2025 to receive the refund.
Calculating Your Refund
To work out your potential refund, check when your subscription last renewed. If it renewed after 30 November 2024, you may be entitled to:
- Personal plan: $50 refund (difference between $159 and $109)
- Family plan: $40 refund (difference between $179 and $139)
Note: If you haven’t received the email, check your junk or spam folders. The refund is only available to subscribers in Australia who receive the official email from Microsoft.
What Should You Do?
It’s important to carefully consider your needs before making a decision. Don’t rush to opt out or switch plans just because you see “refund,” or feel pressured into paying for services you don’t need. There’s no penalty for taking time to decide—you have until 31 December to switch and still receive the refund.
If you use advanced features like Copilot or want the newest tools as soon as they’re released, the $159 Personal plan (or $179 Family plan) could be worthwhile.
If you just want the core applications—Word, Excel, PowerPoint, Outlook—and don’t mind missing Copilot or new features, the Classic plan at the lower price may be better value.
Both plans include security and bug fixes, but only the standard Microsoft 365 plans guarantee ongoing new features.
If you’re considering a switch, check your household’s usage and what’s actually important for you. Talk it through with family members if you have a Family plan, as the decision affects everyone using the subscription.
Why This Matters
The ACCC’s court action highlights the importance of consumer protection and transparency. The maximum penalty under Australian Consumer Law can be up to $50 million per breach, demonstrating how seriously the regulator takes potential misleading conduct. The case serves as a reminder that companies must clearly communicate all available options to Australian consumers.
Helping the Community: Making Informed Choices
The ACCC’s court action highlights why clarity and transparency matter for consumers in our rural and regional communities. Take a moment to read the email carefully, talk to family, friends, or trusted advisers if unsure, and choose the plan that best fits your situation—not just the fastest refund or the glossier upgrade.
If you’re unsure which plan to choose, remember there’s time to decide. You have until 31 December 2025 to make the switch and still receive your refund.
Need More Information?
For more details, see:
- The full ACCC statement at accc.gov.au
- Microsoft’s official support page for plan changes
- Recent ABC coverage of the case
If you have questions about switching plans or technical support, contact Microsoft directly through your account settings or their support channels.
Disclaimer: This article is for general information purposes only and does not constitute financial or legal advice. The information provided in this article is for general informational purposes only. While we strive for accuracy and timeliness, we make no representations or war ranties of any kind, about the completeness, accuracy, reliability, suitability, or availability with respect to the article or the information contained within for any purpose.