Microsoft hikes price of Microsoft 365 for consumers for the first time in 12 years

The company is adding its AI assistant to the consumer version of Microsoft 365, but it’ll cost $3 more a month.

Microsoft is bringing Copilot to users who have Personal and Family plans for Microsoft 365 (formerly Office 365) along with the Microsoft Designer app.

However, new features come with a price increase. The monthly cost will rise by $3, bringing the Personal plan to $10 per month (or $100 annually) and the Family plan to $13 per month (or $130 annually).

According to Microsoft, the price increase will come into effect the next time current customers are billed.

For users who prefer not to use AI features, the company offers "Microsoft 365 Personal Classic" and "Microsoft 365 Family Classic" plans at the original price. These plans must be selected manually on Microsoft's website.

In its blog post, the company provides several examples of how its AI assistant could be used in its Microsoft 365 apps.

Copilot will enable budget analysis in Excel, creation of PowerPoint presentations, summary of emails in Copilot, and organization of lists in OneNote.

In addition, the company is making Microsoft Designer a part of Personal and Family Plans. The app, which allows users to create images from prompts and edit them with AI, will be available in Microsoft 365 programs or as a standalone app on mobile and web.

However, the editing possibilities will be limited. Users will receive a monthly allotment of AI credits for image generation and AI edits, though Microsoft claims that a monthly quota should be enough for most users.

The company claims that the prices of its Personal and Family plans have increased for the first time since they were introduced.

Currently, there are approximately 84 million active Microsoft 365 Personal and Family plans.