Italy launches antitrust probe into Microsoft's AI bundling and automatic price increases

Italy opens an antitrust probe into Microsoft 365's AI price rise

The regulator says customers were moved to a pricier Copilot-bundled plan unless they actively opted out, with too little information to choose. The mechanics of a price rise can matter as much as the price itself, which is the question Italy's competition authority has now decided to examine. On 26 June, the regulator said it had opened an investigation into Microsoft over alleged unfair commercial practices tied to a price increase on its Microsoft 365 subscription. The opening of a probe is not a finding of wrongdoing, but it is the start of an in-depth review. The complaint is less about the higher price than about how customers arrived at it. According to the authority's statement, Microsoft did not adequately inform consumers that Microsoft 365 had been integrated with its AI tools, Copilot and Designer. Customers were automatically moved to a more expensive plan unless they actively opted out, the regulator said, and were given insufficient information to decide whether to renew. The legal hook is the design of that default. The watchdog said the practice could be considered aggressive because it unduly limited consumers' freedom of choice, language that signals the case will turn on the opt-out architecture rather than the headline number. An automatic upgrade that requires the customer to notice it and decline it is a pattern regulators across Europe have grown less willing to wave through. The pricing itself is real and arriving soon. Microsoft's 365 increases take effect from 1 July 2026, with the AI features folded into the bundle. The probe concerns how that change was communicated, not whether Microsoft may charge more for a product it has expanded. The case sits at an intersection regulators have been circling for a while: the bundling of AI features into established software, and the pricing that comes with it. Microsoft has folded Copilot into product after product, even as data showed only a small fraction of users were paying for it. The Italian authority's framing, that the integration was insufficiently disclosed and the upgrade effectively automatic, turns a pricing dispute into a consumer-consent dispute, which is a harder thing for a company to wave away. The adoption problem behind the bundling is well documented. Microsoft has spent the past year trying to convert free Copilot Chat users into paying ones, a paying-customer problem it carried into its Build conference, and folding the AI into a higher-priced default plan is one way to lift those numbers. Microsoft sits under antitrust scrutiny on more than one front. The company faces ongoing examination from the US Federal Trade Commission, and the Italian case adds a European consumer-protection dimension to a busy regulatory year. Even Microsoft's own terms have described Copilot output as 'entertainment only' in places, a detail that sits awkwardly beside a price rise justified by the feature. What the authority decides will hinge on a narrow question. Did customers understand what they were being signed up for, and were they given a real chance to say no. Microsoft had not issued a detailed public response at the time the probe was announced, and the company is entitled to make its case as the review proceeds. The authority has been explicit that opening an investigation is a procedural step rather than a conclusion. The same pressure on Copilot economics recently pushed Microsoft to rethink parts of its enterprise AI strategy. Cases of this kind often run for months and can end in a settlement, a commitment to change the disclosure, or no finding at all. The next step is procedural. The authority will gather evidence and Microsoft will respond, with no fixed deadline disclosed. For now the case is an investigation, not a verdict, and the price rise proceeds on schedule regardless.

Microsoft Probed in Italy Over Pricing of AI Bundles

Italy's antitrust watchdog launched a probe into Microsoft's pricing, saying the U.S. tech giant might have failed to clearly inform users that artificial-intelligence tools had been bundled into its Microsoft 365 suite of products. The Italian Competition Authority said Friday that its investigation focuses on how Microsoft told consumers about an increase in the subscription price for its Microsoft 365 service. The company might have failed to make it sufficiently clear to consumers that the subscription service had been integrated with its Copilot and Designer AI tools, and might have made it difficult to opt out of a price increase by placing them by default on a higher-cost plan, the authority said. Microsoft didn't immediately respond to a request for comment. The regulator said it would investigate whether Microsoft's behavior breached consumer rules. The investigation in Italy comes after Australia's consumer watchdog sued Microsoft last year, claiming the company didn't clearly tell existing Microsoft 365 subscribers how to decline paying for Copilot AI tools when their annual plans renewed.