Microsoft is forcing its AI assistant on people—and making them pay

Summary
- The tech company has made Copilot part of its 365 subscription service in several markets and raised prices.
Microsoft is trying a new approach to build excitement for its artificial-intelligence assistant Copilot: Give it to customers whether they want it or not.
The tech company recently added Copilot to its consumer subscription service for software including Word, Excel and PowerPoint in Australia and several Southeast Asian countries. Along with the AI feature, it raised prices for everyone who uses the service, called Microsoft 365, in those countries.
What about people who don’t want to pay for an AI assistant to spruce up their documents and summarize emails? They are out of luck.
Alistair Fleming uses Word to write scripts for his YouTube channel about 1990s Japanese wrestling. The Australian noticed that every time he finished a line, Copilot’s rainbow logo would pop up on screen and ask if it could help with his writing.
“It was very keen to be used, and this was irritating to me as a user," Fleming said.
Fleming also noticed his monthly bill for 365 increased to 16 Australian dollars from A$11.
Some users said on social media that Copilot pop-ups reminded them of Clippy, Microsoft’s widely derided Office helper from the late 1990s, that would frequently offer unsolicited help.
A Microsoft spokesman wouldn’t comment on the strategy behind the forced addition of Copilot in certain regions and whether the company plans a similar approach in other markets.
The change demonstrates the lengths to which Microsoft is going to try to profit from its huge investments in AI. Copilot, which is built with technology from OpenAI, is a key part of Chief Executive Satya Nadella’s plan to keep expanding Microsoft’s software business for consumer and corporate customers.
Microsoft is OpenAI’s biggest investor, having plowed close to $14 billion into the ChatGPT maker.
Microsoft has been trying since early 2023 to use generative AI to gain ground in the market for consumer apps, where it has long struggled. It first integrated the tech into its Bing search engine as a chat tool, but failed to gain much ground against Google. It later launched Copilot, a chatbot and content generator that integrates with 365 software to help write emails, summarize meetings and create PowerPoint slides.
The premium consumer version of Copilot launched in January at a price of $20 a month in the U.S. which is on top of the roughly $7 monthly fee for an individual subscription to 365.
Like other tech companies playing catch-up in the AI market, Copilot has struggled against OpenAI’s dominant ChatGPT. The Copilot chatbot app was downloaded 37 million times from May 2023 through mid-December, compared with 433 million downloads for ChatGPT, according to Sensor Tower data.
Microsoft is also pushing Copilot to its enterprise software customers at a price of $30 a person. Business clients are the biggest part of Microsoft’s software business.
Businesses have been mixed on Copilot’s usefulness and have questioned whether the AI tools’ outputs are accurate, if it protects their private data and if it is helpful enough to justify the cost.
The Microsoft spokesman didn’t respond to requests for comment on corporate customers’ satisfaction with Copilot. The company has said its AI protects user data and meets privacy standards across multiple regions.
Microsoft hasn’t released sales figures for Copilot, but recently said at a conference that nearly 70% of Fortune 500 companies use the AI assistant. It also recently said total AI revenue will soon surpass $10 billion on an annualized basis. That figure encompasses all its AI services, including cloud computing for other developers.
The company is facing pressure from rival enterprise-software companies that have released their own AI-infused products, including Salesforce, as well as AI developers moving into corporate sales. One of the most significant is OpenAI.
Jared Spataro, who heads marketing for Microsoft’s workplace AI efforts, has told employees that ChatGPT Enterprise is Copilot’s biggest competitor, according to a person familiar with the matter.
Inside the company, Copilot is viewed as step one of its AI strategy. The next wave will center on agents—automated tools that can handle more complex tasks such as customer-service interactions or booking travel.
Selling customers on agents will be easier if they are already satisfied users of Copilot.
In Australia, adding Copilot to 365 for individuals prompted some blowback on social media.
Fleming looked into removing the AI feature from the software but found it wasn’t feasible. Instead, he canceled his subscription. He uses Google Docs now.
Write to Tom Dotan at tom.dotan@wsj.com