7am Why the ACCC is suing Microsoft
Oct 28, 2025
Hannah Marshall, a corporate and consumer law principal at Good Company Law, breaks down the ACCC's lawsuit against Microsoft over misleading subscription tactics. They discuss how Microsoft rolled out its AI 'co-pilot' feature with unclear pricing, allegedly leaving users believing an increased cost was mandatory. The conversation dives into potential penalties Microsoft could face, the implications this case has for broader consumer law reforms, and practical tips for consumers to avoid tricky subscription tricks. A riveting look at a David vs. Goliath legal battle!
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Hidden Third Option In Price Hike
- Microsoft told 2.7 million personal and family subscribers they'd face a price hike because Copilot was being added to Microsoft 365.
- The ACCC alleges a hidden third option let subscribers keep their plan and price without Copilot, which many didn't know about.
Threefold Misleading Allegation
- The ACCC alleges Microsoft misled customers about Copilot being necessary, about higher prices being necessary, and about only offering two choices.
- The regulator prosecutes lack of transparency and manipulation, not price changes per se.
Deliberateness Could Raise Penalties
- The ACCC alleges Microsoft acted deliberately to boost Copilot uptake and revenue, and may have evidence from compelled documents and complaints.
- Deliberateness isn't required for liability but can increase penalties if proven.