Microsoft adds Copilot to Office App, marking the first price increase in twelve years for Microsoft 365
The subscription price for Microsoft 365 Personal has increased by approximately 43%, rising to $9.99 per month and $99.99 per year. The price for Microsoft 365 Family has increased by 30%, rising to $12.99 per month and $129.99 per year. The price increase takes effect immediately for new users and does not apply to existing users, but will increase upon renewal
Microsoft has raised the price of its consumer-oriented office software suite Microsoft 365 for the first time in twelve years, as subscription users are willing to spend more on new artificial intelligence (AI) tools.
On Thursday, January 16th, Eastern Time, Microsoft announced the integration of its AI assistant Copilot into a series of Office applications, including Word, Excel, PowerPoint, Outlook, and OneNote. At the same time, the monthly subscription price of Microsoft 365, formerly known as Office 365, has been increased by $3, with annual fees also raised. This is the first price increase for the software suite since its launch in 2013.
Specifically, the monthly subscription price for the Microsoft 365 Personal plan, which is for individual use, has increased from $6.99 to $9.99, with an annual fee rising from $69.99 to $99.99, representing an increase of approximately 43%. The Microsoft 365 Family plan, which can be used by up to six people, has seen its monthly subscription price rise from $9.99 to $12.99, and the annual subscription price increase from $99.99 to $129.99, both reflecting a 30% increase.
Microsoft's price increase will affect tens of millions of users. As of the third quarter of last year, the number of subscribers to Microsoft 365 for consumers reached 84.4 million.
Microsoft stated on Thursday that the price increase for the U.S. market would take immediate effect for new subscribers and will also impact renewing users. The price increase does not apply to existing users, but if they wish to renew, they will have to subscribe at the new increased prices during the renewal period.
In addition to incorporating Copilot into the Microsoft 365 App, Microsoft has also introduced the image editing tool Microsoft Designer for consumer subscribers.
In a blog post announcing the price increase and the inclusion of tools like Copilot, Microsoft Vice President Bryan Rognier stated that the price increase is intended to "reflect the extensive subscription benefits we have added over the past twelve years and enable us to deliver new innovations in the coming years." The inclusion of Copilot and Microsoft Designer "brings the transformative power of AI to personal productivity tools used by millions every day."
Microsoft indicated that for a limited time, existing users can switch to software product plans without Copilot or AI credits. To access certain new innovations and features, a subscription to Microsoft 365 Personal or Family plans will be required