AI features in Microsoft 365 are insanely expensive for consumers, and it makes no sense

A few months ago, I published an editorial emphasizing how Microsoft 365 is still my favorite product, but it's getting too expensive. That piece was triggered by me having to pay my annual Microsoft 365 Family subscription fee and realizing that it had been hiked to $129.99, up from the $99.99 I originally paid for it.

Microsoft's justification for this price increase was the addition of AI features, which I argued is ludicrous considering that you only get a few AI "credits" per month, and they can only be leveraged by the subscription owner. But hold on, it gets worse from here, so consider this piece a continuation of my previous editorial.

The way things stand right now is that Microsoft 365 Personal and Family cost $99.99/year and $129.99/year, respectively, and both of these offer excellent value if you're primarily looking to use Office apps and OneDrive cloud storage. The only difference between them is that Personal is for one user while Family allows sharing the subscription's benefits with up to six people. For just a difference of $30/year, Family makes a lot of sense if you do want to share it with other people. It also allows you to share the cost, which means that if you share with five other friends who also agree to pay their share, you'll effectively be paying $22/year, a massive reduction in price compared to the $99.99/year Microsoft 365 Personal, at least for the owner. Do note that AI features cannot be used by other members of the family account, but hey, at $22/year, that's still an awesome value.

But things begin to get messy when you compare Microsoft 365 Family to Microsoft 365 Premium, a relatively new subscription plan that was introduced in October 2025. This Premium subscription costs an eye-watering $199.99/year, which is an insane price bump of $70 compared to Family.

Meanwhile, the only difference between Microsoft 365 Family and Premium in terms of value is that you'll get higher usage caps for some AI services and get access to a few new AI features. For example, the former offers 60 AI credits per month, whereas the latter promises "extensive usage beyond standard credit limits". Similarly, Copilot Vision and Voice have higher limits too, and you do get exclusive access to some "advanced" AI capabilities. Meanwhile, Agents, Actions, and the COPILOT function in Excel are only available for Premium subscribers.

Now, I will argue that whether this $70/year price for AI features is worth it or not is another matter altogether, because what really grinds my gears are a few things. For starters, all of these benefits are only available to the owner of the subscription. If you have a Family plan and you divide the cost equally among all members, why would everyone agree to pay $33/year just so you can avail all the AI benefits? Seriously, what is the value offering for a "family" unless everyone else is not tech-savvy and you just lie to them and convince them that the $199.99/year is worth it compared to the $129.99/year Family Plan? I'm not even being satirical; I seriously want to know why a family would opt to buy Premium, unless, of course, the cost is not being shared equally?

But that leads me to my second problem with this subscription. It costs $70 more than the Family plan while giving more access to AI capabilities, but here's the kicker: it was actually a replacement for the Copilot Pro add-in, which was supposed to do the same thing but for an optional $20/year. So, of course, it is a great business justification for Microsoft that it gets to bag an extra $50/year from each customer, but it's daylight robbery for anyone else who has been following the recent price hikes of Microsoft 365 in lieu of AI features.

Microsoft 365 Premium makes absolutely no sense unless you absolutely need all the Copilot capabilities you can get, and $70/year is pocket change for you. I don't think that it is for the vast majority of Microsoft customers.

The way that Microsoft 365 plans are structured just create more confusion for customers and are predatory. I don't know for sure if this is by design or not, but remember, this is the same company that changed the Family plan's pricing to $129.99 and conveniently hid the previous $99.99/year "classic" plan without the AI features until customers threatened to cancel. It's also the same sort of boneheaded move that can be expected from a firm that renamed the Office "hub" app to Microsoft 365 Copilot just so it could emphasize its presence in the AI space to customers.

So, yeah, I wouldn't be surprised to learn that all this obfuscation with regards to Microsoft 365 is completely intentional. If you want some AI features, you should pay us $99.99 (Personal) or $129.99 (Family), but hey, if you want to use all of them, but still with some limits, please pay us $199.99 (Premium). The pricing structure with respect to the value on offer just doesn't add up. Do better, Microsoft.