Microsoft 365 Subscription Price Hike: Copilot Added Cost Explained

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You may have noticed some quiet ripples in the Microsoft 365 universe, but for those who missed them, here’s the skinny: Microsoft has begun increasing subscription costs for its Microsoft 365 Personal and Family plans, citing the inclusion of its AI-powered tool, Copilot, as the primary driver behind the price hikes. While AI and automation are undoubtedly exciting innovations, not everyone is thrilled about footing the bill for features they may not want or need.
Good news for those feeling disgruntled: Microsoft is offering an alternative called Microsoft 365 Classic, which removes Copilot’s AI wizardry and, importantly, the added cost. Let’s dive into what this means, how Copilot affects pricing, and, most critically, how you can opt out and save.

What’s the Deal with Copilot?​

To understand why this is happening, we need to delve into what Copilot brings to the table. This AI is like your hyper-efficient digital PA and promises to revolutionize workflows within Microsoft’s apps such as Word, Excel, and Outlook. Think of it like a turbocharged Clippy that not only helps with formatting and grammar but can assist in data analysis, craft full-fledged reports, summarize meetings, draft emails based on cues, and even automate repetitive tasks.
Sounds like magic, doesn’t it? Well, it comes with a catch. Microsoft has packaged Copilot into the standard Microsoft 365 subscriptions and tacked on an additional cost for these advanced AI capabilities. Prices in regions such as Australia, New Zealand, Malaysia, and Singapore have shot up by a significant margin. For instance, Australians are now looking at $179 AUD per year for the Microsoft 365 Family plan, up from $139 AUD—a cool $40 AUD price bump.
Here’s the twist: Not everyone wants or needs Copilot in their daily workflow, and Microsoft has acknowledged this feedback by offering the option to revert to what they call Microsoft 365 Classic.

What is Microsoft 365 Classic?​

Microsoft 365 Classic is essentially a stripped-down version of Microsoft 365, minus the Copilot functionality. It provides all the traditional features users have grown accustomed to—cloud storage, productivity apps like Word and Excel, and collaboration tools—without forcing you to pay extra for AI.
But here’s the kicker: Opting into Microsoft 365 Classic isn’t as straightforward as clicking a button, at least not for everyone. While some users report being able to switch easily, others, particularly those in Australia, have hit roadblocks. Below, we’ll outline the methods to navigate this transition.

How to Opt Out of AI Charges and Switch to Microsoft 365 Classic

If you find yourself balking at the prospect of paying for Copilot, here’s how you can opt out. The process may depend on your region and circumstances, but there are two main approaches to downgrading your subscription.

Method 1: Self-Serve Option

This is the simplest way to downgrade—if it works for you. Here’s the step-by-step guide:
  • Access your Microsoft Account Settings:
  • Visit accounts.microsoft.com and make sure you’re logged in with the account tied to your subscription.
  • Select Manage Subscription:
  • Locate your Microsoft 365 subscription—this will often appear under “Services & Subscriptions.”
  • Cancel Subscription:
  • Click the “Cancel subscription” option. Here’s the critical moment: Upon initiating the cancellation, some users may see a prompt to switch to Microsoft 365 Classic instead of outright canceling.
  • Confirm Selection:
  • If prompted, select Microsoft 365 Classic to complete the downgrade.
Troubleshooting tip: Not everyone gets this “opt-in to Classic” option. If you find yourself unable to locate it, proceed to Method 2 below.

Method 2: Speak to a Microsoft Representative

For users unable to self-serve (a common issue in regions like Australia), a direct conversation with a Microsoft representative may be necessary. Here’s how to streamline the process:
  • Contact Microsoft Sales Support:
  • Head to the Microsoft Sales Support page.
  • Log in with your account credentials and choose the Chat with Sales option.
  • Explain Your Request:
  • During the chat, navigate options like "Personal > Connect with a Microsoft Store Associate > Chat > Microsoft 365/Office." Make it clear that you want to downgrade from the standard Microsoft 365 plan to Microsoft 365 Classic to avoid Copilot-related charges.
  • Follow Their Instructions:
  • Depending on the representative, you might be instructed to wait until your next billing cycle or given immediate downgrade capabilities.
  • Persistence Pays:
  • Some users reported being bounced between teams before successfully downgrading, so don’t be afraid to push for additional support if the process seems convoluted.

Why Can’t Everyone Opt-Out Easily?​

Microsoft acknowledges that while Microsoft 365 Classic is technically available, not all users have equal access to the downgrade path. The company has stated it’s “listening to feedback and continuously working on providing options to customize these experiences.”
Translation: They’re trying to balance the push toward AI adoption with customer satisfaction. However, the variability of the opt-out process—some users can self-serve while others need to go through Support—has left many frustrated.
This situation also raises an interesting question about opt-in vs. opt-out models for new features. By bundling Copilot into Microsoft 365 by default, Microsoft is banking on users accepting the higher price rather than taking the extra steps to opt-out.

Broader Implications for Windows and Office Ecosystem​

The integration of an AI subscription premium reflects an emerging trend across platforms: monetizing the growing appetite for AI tools. We’ve already seen similar moves in services like Adobe Creative Cloud (think Firefly tools) and even Slack with AI-powered communication assistants. Microsoft’s gamble here is that AI isn’t just a nice-to-have—it’s a necessity for future productivity.
But for Windows users reliant on basic functionality, this raises concerns: Will we see a future where traditional software tools—once “just there” as part of subscriptions—become piecemeal add-ons tied to advanced price tiers? And where does that leave users who simply want affordable, reliable software that doesn’t try to predict their next move?

Final Thoughts: To Copilot or Not To Copilot?​

Microsoft may be blazing new trails with Copilot, but they must tread carefully to avoid alienating a core user base that values simplicity and fair pricing. If you’re happy paying extra for AI, Copilot may be an incredible tool for transforming your workflow. But for those who just want the basics without the bells and whistles, Microsoft 365 Classic offers an escape hatch—but only if you’re persistent enough to grab it.
Let us know your thoughts: Is Copilot worth the extra cost, or are you planning to make the switch to Classic? Have you run into issues navigating the downgrade process? Share your experiences and advice on our forums!

Source: Stevivor Microsoft 365 charges for AI: Here’s how to opt out for Microsoft 365 Classic
 


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