TLDR
- Microsoft 365 Premium merges Copilot AI & Office for $19.99/month.
- MSFT dips as AI-driven Microsoft 365 Premium takes on ChatGPT Plus.
- New Microsoft 365 Premium blends AI Copilot tools with productivity apps.
- Microsoft reshapes consumer AI with $19.99 Premium subscription plan.
- AI Copilot goes mainstream: Microsoft 365 Premium replaces Copilot Pro.
Microsoft (MSFT) shares surge slightly by market close Wednesday, ending at $518.82 after fluctuating throughout the trading session.
Microsoft Merges Productivity and AI Tools Under One Subscription
Microsoft announced a new subscription tier, Microsoft 365 Premium, priced at $19.99 per month. The plan combines Office desktop apps for up to six users with AI-powered Copilot tools and generous cloud storage. It replaces the need for separate Copilot Pro and Microsoft 365 Family or Personal subscriptions.
This consolidation simplifies the offering and enhances value with higher usage limits and new AI features. Microsoft positions this as its most advanced plan for professionals and high-output individuals. The move aligns Microsoft’s pricing directly with OpenAI’s ChatGPT Plus, signaling competitive intent.
Copilot Pro will no longer be sold; however, it will continue to be available to current users. Microsoft confirmed it will not auto-migrate users to the new Premium tier. Copilot Pro was initially launched at $20 per month in early 2024 as an add-on to Office subscriptions.
Consumer AI Use Gains Corporate Reach
Microsoft is now allowing personal subscribers to use AI features in corporate Office environments. Users can sign into their work apps with personal accounts to activate Microsoft 365 Copilot functionality. This allows employees to use premium AI features even without a corporate license.
Microsoft says this new access respects corporate data protection policies. The system enables AI features while maintaining enterprise security, compliance, and data privacy standards. This access will work on most platforms, including Windows, Mac, iPad, and more, except web versions.
This capability is only available to the main account holders of Premium or Family plans. Microsoft acknowledged feedback about expanding access to shared family users and is considering future options. These moves reflect a broader push to integrate AI into both personal and professional productivity.
AI Strategy Boosts Consumer Growth Amid Competition
Microsoft continues to capitalize on growing demand for AI-driven productivity. It reported 89 million consumer Microsoft 365 subscribers in the June quarter, an 8% annual increase. Revenue from these services has accelerated for three straight quarters, hitting 20% growth.
With Microsoft 365 Premium, the company aims to defend its productivity leadership against offerings like ChatGPT Plus. Premium subscribers will gain enhanced access to GPT-4o tools including voice features, image generation, and research assistants. These features were previously exclusive to enterprise users.
Microsoft’s deep partnership with OpenAI underpins much of its AI expansion. Microsoft integrates OpenAI models into its Copilot and provides infrastructure through its Azure cloud. Despite this collaboration, both companies continue to compete in the consumer AI space.
