Microsoft Increases Prices for Microsoft 365 Subscription

Microsoft has announced that it will raise the price of its consumer version of Microsoft 365, marking the first price increase in 12 years. In a recent blog post, the company stated that the changes will reflect the addition of new features, including artificial intelligence tools, to its service.

The Microsoft 365 suite, which includes popular applications such as Word, Excel, PowerPoint, Outlook, and OneNote, will see a price increase of $3 per month. According to Bryan Rognier, vice president of Microsoft 365 Consumer, this price adjustment is intended to help sustain new innovations and improvements moving forward.

New Pricing Details

After the price hike, a Microsoft 365 Personal subscription will cost $9.99 per month, or $99.99 annually, up from the previous $6.99 per month and $69.99 per year. Meanwhile, the Microsoft 365 Family plan, which can accommodate up to six users, will now be priced at $12.99 monthly and $129.99 per year, increasing from $9.99 and $99.99 respectively.

As of the September quarter, Microsoft had around 84.4 million subscribers for its consumer version of Microsoft 365, reflecting a growth of 10%. Current users will notice the new pricing structure when it's time for their subscription to renew.

Enhancements to Microsoft 365

Alongside the price change, Microsoft is integrating its Copilot AI assistant into consumer applications of the Microsoft 365 suite. Additionally, subscribers will gain access to Microsoft Designer, an AI-driven image editing tool.

For a limited time, current subscribers will have the option to switch to plans that exclude Copilot and other AI features. Microsoft has assured users that these plans will continue to be offered in their current form, but accessing certain new features will require a Microsoft 365 Personal or Family subscription.

As previously known as Office 365, Microsoft 365 plays a crucial role in Microsoft's strategy to compete with tools offered by Google in the consumer productivity market. Nevertheless, business subscriptions for Microsoft 365 generate more revenue for the company, accounting for 31% of its fiscal third-quarter earnings, in contrast to less than 3% from consumer subscriptions.

Microsoft, price, subscription