The CMA’s Copilot case won’t check small firms’ Microsoft renewals

The Competition and Markets Authority (CMA) opened an investigation into Microsoft on 29 July over how it communicated changes to its Microsoft 365 Personal and Family plans. From January 2025, Microsoft gave existing subscribers new features such as Copilot at no extra cost for the rest of their term, then rolled them on to a higher-priced plan at renewal unless they chose another plan or canceled. The CMA says it has reached no conclusions about whether Microsoft has broken the law.

The sums are modest. According to the CMA, the Classic Personal plan costs £59.99 a year against £84.99 for the version with the new features, and the Family plan £79.99 against £104.99. The regulator’s question is whether customers were given the key information, including the difference in cost, before they renewed.

Small businesses are outside that case. The investigation covers Personal and Family plans. Yet the Microsoft 365 Business suites went through their own repricing on 1 July, also packaged with new Copilot features, and nothing in the CMA’s case checks whether a 20-person firm understood what changed.

That is the point small firms should take from the CMA’s move. AI is arriving in small-business software the way it arrived in consumer software: bundled in and billed at renewal. A default is a decision someone else has made. Every renewal of an AI-bundled suite should be treated as a purchase, not an administrative task.

The business price rise has already started

Microsoft announced a global price and packaging update for its Microsoft 365 commercial suites on 4 December 2025, effective 1 July 2026. On its US dollar list, Business Basic rises 17% from $6 to $7 (£4.50 to £5.30) per user per month, and Business Standard rises 12% from $12.50 to $14 (£9.40 to £10.50). Business Premium stays at $22. Microsoft says list prices may vary by country and currency, so UK buyers should check their own sterling quotes. Existing customers stay on current pricing until their renewal.

What the extra money buys, according to Microsoft, is an additional 50GB of email storage, URL time-of-click protection on Basic and Standard, Copilot Chat Analytics and what it calls Copilot Chat enhancements. Those enhancements include inbox and calendar awareness and access to Word, Excel and PowerPoint agents.

Microsoft gave plenty of notice. Its December announcement said: “We’re sharing these updates now to give customers ample time to plan.” The question is whether small firms used that time.

Much of the AI may go unused

A bundle priced partly on AI assumes the AI will be used. Official data suggests many firms are not there yet. The Office for National Statistics (ONS), in an article published on 20 July, found that self-reported AI use among UK businesses with 10 or more employees has risen from around 12% to around 35% since late 2023, with larger firms more likely to have adopted it. On those figures, roughly two in three firms of that size do not report using AI at all.

Adoption is also shallow where it exists. The ONS says the average number of AI technologies used by an adopting business rose only modestly, from around 1.4 to around 1.6, over the same period.

For a business that does not use Copilot Chat, its enhancements are a cost line rather than a capability. The new prices are not necessarily unfair. The security and storage additions have value, and time-of-click link checking may well matter more to a small firm than an AI agent in Excel. But the business should know which of those things it is paying for.

The renewal is a purchase

Four checks follow. The first is the renewal date. Because existing customers keep current pricing until renewal, the date in the contract decides when the increase lands. A firm that knows its date and its per-seat cost in advance can budget; one that finds out from the invoice cannot.

The second is the tier. Microsoft’s list includes suites without Teams at lower prices – Business Standard without Teams is $10.79 on the new list. A business that already runs its calls and meetings on another platform should price that option before renewing the default.

The third is the seat count. Every license held for a leaver or an unused mailbox will cost more once the new prices apply. A license audit before renewal is the cheapest saving available.

The fourth is the AI itself. If staff will use Copilot Chat, the business needs a short policy on what data goes into it and who checks the output. If they will not, the owner should record that the AI features are unused and judge the tier on its security and storage alone.

None of this needs a consultant. Someone in the business has to own the renewal rather than let it roll.

The CMA is asking whether home users were told enough to choose. Its case does not ask that question for small firms, so they had better ask it themselves.