Italy Launches Antitrust Probe into Microsoft 365 Price Hike with AI Copilot Integration

Italy's antitrust authority has opened an investigation into Microsoft over alleged unfair commercial practices tied to the integration of AI tools into Microsoft 365. The probe, announced on June 26, centers on whether the company failed to adequately inform customers that Microsoft 365 subscriptions would include its Copilot AI assistant at a higher price.

The Italian Competition Authority (AGCM) said customers were moved to a more expensive Copilot-bundled plan unless they actively opted out, with too little information to make an informed choice. The price increase for Microsoft 365 subscriptions in Italy took effect without clear prior notice, according to the regulator.

Automatic Migration and Lack of Transparency

The AGCM alleges that Microsoft did not disclose the price hike or the inclusion of Copilot as an integrated feature when users renewed or continued their existing plans. Instead, subscribers were automatically switched to a tier that bundles the AI assistant at a higher monthly or annual cost. The regulator contends this practice violates Italian consumer protection laws, which require clear and timely information about changes to contract terms.

• Microsoft 365 users in Italy were not informed that Copilot would be included in their subscription, according to the AGCM.
• The price increase was imposed without an explicit opt-in mechanism for the AI feature.
• Customers had to actively opt out of the bundled plan to avoid the higher cost, rather than being asked for consent.
• The investigation covers both consumer and business plans of Microsoft 365.
• The AGCM has the power to impose fines or order changes to Microsoft's pricing practices if violations are found.

Implications for AI-Driven Pricing and Consumer Rights

This probe marks a significant test case for how regulators view the bundling of AI features into existing software subscriptions. As companies like Microsoft, Google, and others integrate generative AI into their core products, questions about transparency, pricing, and consumer choice are coming to the forefront. The outcome could set a precedent for how antitrust authorities in Europe and beyond handle similar practices.

Microsoft has not yet publicly responded to the investigation. The AGCM will now examine whether the company's conduct amounts to unfair commercial practices, with a potential fine of up to 10 million euros or a requirement to alter its subscription model. The case underscores the growing scrutiny of AI monetization strategies by European regulators.