Australia sues Microsoft over 'misleading' AI offer

Core Viewpoint - Australia has filed a lawsuit against Microsoft for allegedly misleading Microsoft 365 subscribers regarding the AI assistant Copilot, claiming that the company did not adequately inform users about their subscription options [3][4][6]. Group 1: Allegations and Details - The Australian Competition and Consumer Commission (ACCC) accuses Microsoft of making "false or misleading" statements to approximately 2.7 million auto-renewal subscribers of Microsoft 365 [4][7]. - Microsoft allegedly presented two options to customers: pay extra for Copilot-integrated services or cancel their subscriptions, omitting a third option to retain existing "Classic" plans at the original price [5][6]. - The ACCC claims that Microsoft intentionally concealed the existence of the Classic plans until after users began the cancellation process, aiming to increase the number of subscribers on more expensive plans [6][7]. Group 2: Financial Implications - The annual subscription costs for Microsoft 365 plans with Copilot are reported to be between 29% and 45% higher than those without [7]. - The ACCC is seeking penalties, injunctions, consumer redress, and costs, with potential penalties for Microsoft exceeding Aus$50 million (approximately US$30 million) for each breach [8].