It’s official: All your Office apps are getting AI and a price increase

If you’ve got a Microsoft 365 Personal or Family subscription, you’re about to get a jumbo serving of AI in your Office apps. Word, Excel, PowerPoint, OneNote, and Outlook will all get a new Copilot button that opens a prompt pane where you can get help writing documents, analyzing spreadsheets, summarizing email messages, and building presentations. In addition, those subscriptions will get the AI-powered Microsoft Designer app, which can build images from prompts and edit unwanted objects from existing photos.

The new features, announced in a post on the Microsoft 365 blog, will be available as part of the latest Microsoft 365 update and come with a significant price increase. In exchange, subscribers will receive a monthly allotment of 60 AI credits that can be used with Copilot and Microsoft Designer across a variety of apps. The credits reset on the first of each month, regardless of when the subscription renews.

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Microsoft 365 Family subscribers will see a 30% price increase, from $10 to $13 per month. The cost of an annual subscription will go up to $130 from the current $100. With a Microsoft 365 Personal subscription, you’ll see an increase of nearly 43%, from $7 to $10 per month, with the annual rate going from $70 to $100.

These are the first-ever price increases for the subscription-based products, which were previously known as Office 365 and have been available to consumers since 2013.

The new prices will be effective at the next renewal period.

Subscribers will have access to the AI features on any supported platform. If you use your Microsoft 365 Personal or Family subscription on an iPhone, for example, expect to see this pop-up window shortly:

The global rollout of Microsoft 365 Copilot comes after several months of testing in Australia, New Zealand, Malaysia, Singapore, Taiwan, and Thailand. Microsoft promised it would “listen, learn, and improve” based on feedback from customers in those countries.

At least one part of today’s announcement appears to be a direct response to that feedback. “[We] know there are times when AI assistance isn’t desired (like in some academic scenarios), so we’re adding settings in apps like Word, Excel, and PowerPoint that allow you to disable or enable Copilot as needed.”

That link goes to a support article that promises there will be a simple checkbox to enable or disable Copilot beginning with version 2412. I couldn’t find that checkbox in Word, and Microsoft’s instructions acknowledge that they’re still working on adding the Enable Copilot checkbox to Excel, OneNote, and PowerPoint on Windows devices and to Excel on Mac devices. That change is tentatively scheduled to happen in February 2025, according to the support article. In the absence of that button, users have the option to hide the Copilot button from the ribbon or to disable all connected experiences, which includes suggested replies in Outlook, the Microsoft Editor add-in, and the ability to dictate text. 

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As in the test markets, customers with current Microsoft 365 subscriptions can opt out of the AI-enhanced versions (and keep the current pricing) by switching to a Personal Classic or Family Classic plan. New subscribers apparently will not be able to choose a Classic plan, and Microsoft cautions that those downgraded products are “limited offers and may not always be offered as a plan option.”

Even after switching to a Classic plan, Microsoft notes, you might still have access to the AI-enhanced version; the plan change will take effect at renewal.

For Microsoft 365 Family subscriptions, the new features are available only for the subscription owner and can’t be shared with others. Those users will either need their own subscription or will have to pay $20 a month for a Copilot Pro subscription.

I’ve been following forums where subscribers in Australia, New Zealand, and other countries in the test market provided feedback to Microsoft. That feedback has been overwhelmingly negative, with plenty of customers vowing to cancel their Microsoft 365 subscriptions rather than accept the price increase.

Also: Microsoft Copilot vs. Copilot Pro: Is the subscription fee worth it?

No doubt someone in Redmond has put together a spreadsheet that predicts just how many of those subscribers are likely to follow through with their cancellations and how many will simply accept the price increase. Maybe they even had Copilot help them whip up an Excel formula to build that model.

If so, it might be smart to listen to Copilot’s own warnings. “While I strive to be reliable, I’m not perfect and can occasionally make mistakes,” Copilot told me just now. “It’s always a good idea to double-check important information, especially if it impacts significant decisions or actions.”