Microsoft is facing growing scrutiny in Australia after the competition watchdog accused the tech giant of misleading millions of users over subscription pricing, prompting an apology and a refund offer.

The dispute involves Microsoft 365 subscriptions, where the introduction of the AI assistant, Copilot, allegedly pushed customers towards more expensive plans.

Last week, the Australian Competition and Consumer Commission (ACCC) launched a Federal Court lawsuit, claiming about 2.7 million Australians were misled by these changes.

In a letter to customers on Thursday, Microsoft said it “fell short of our standards” and could have “communicated more clearly” when it changed pricing in October 2024.

“In response to the demand for advanced AI tools, we introduced AI capabilities into the M

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