Microsoft just added another tile to its subscription mosaic: Microsoft 365 Premium. It’s $20 a month, it bundles the full Office suite with access to OpenAI’s latest models and higher AI usage limits, and yes, it’s explicitly positioned as “more value” than ChatGPT Plus… which also happens to cost $20. Bold move to one-up your closest AI partner by stapling Word and Excel to the deal, but here we are.
On paper, the math is straightforward. If you pay for Microsoft 365 Personal at $10 and wanted higher AI ceilings, you previously tacked on Copilot Pro for another $20. That’s $30. Now there’s a single $20 tier that gives you Office, 1TB of OneDrive, and premium AI access. That’s a real price/performance win for lone users who actually work in Word, Excel, PowerPoint, and Outlook—and don’t need a bunch of bells and whistles from OpenAI’s standalone product.
The timing is… pointed. Microsoft just jacked Game Pass Ultimate to $30 a month, so the company clearly isn’t allergic to price hikes. But here it’s doing the opposite play: collapsing two SKUs into one and killing Copilot Pro for new buyers. Existing Copilot Pro subscribers can keep trucking, but they won’t be auto-migrated to Premium, which means Microsoft gets to keep the SKU maze confusing just a little longer.
Feature-wise, Premium gets you GPT-5 and GPT-4o access, plus Microsoft’s new AI agents: Actions, Researcher and Analyst. Think task automation, information synthesis, and data workhorses that live close to your documents instead of floating in a separate chat tab. You’ll also get to test new AI features early. The fine print: you don’t get OpenAI’s custom GPTs or Sora video generation. If those matter to your workflow or your content diet, ChatGPT Plus still has a lane.
The bigger story is strategic. Microsoft is bundling AI where people already live: inside Office. A lot of “AI value” gets lost when you have to context-switch into a separate app to paste content back and forth. By contrast, Premium lets Microsoft flex what it uniquely owns—your files, your email, your spreadsheets—and put AI right on top of that. It’s not just a chatbot; it’s an editor for your Word draft, a formula whisperer in Excel, and a slide ghostwriter in PowerPoint. That’s a hell of a wedge compared to a general-purpose chatbot with no native document stack.
Is this friendly to OpenAI? Eh. Microsoft basically took a $20 AI subscription, added the Office suite and a terabyte of storage, and kept it at $20. You can call it “more value than ChatGPT Plus,” or you can call it what it is: leveraging distribution and product adjacency to squeeze a partner that can’t match the bundle. It’s not personal; it’s platform economics.
There are still cracks if you look for them. Premium appears built for single users, whereas Microsoft 365 Family at $13 covers up to six people. If you’re running a household, Premium doesn’t obviously replace the Family plan’s value unless Microsoft introduces a “Premium Family” SKU. Also, Microsoft didn’t publish exact “extended usage limit” numbers here, which matters for power users who’ve had prompts throttled at peak times. And while GPT-5/4o access sounds great, the real test is latency and reliability during business hours—not just model branding.
Still, the value calculus is pretty simple:
- If you want both Office and a top-tier AI model, Premium at $20 is a cleaner, cheaper path than stacking a $10 Office plan with a separate $20 AI add-on.
- If you only want a general-purpose chatbot and don’t care about Office or OneDrive, ChatGPT Plus remains fine, particularly if you’re into custom GPTs or you’re experimenting with Sora when it’s available.
- If you don’t care about AI at all, keep your $10 Personal or $13 Family plan and move on with your life.
The Copilot Pro sunset is the tell. Microsoft tried “AI as an add-on,” learned what it needed about uptake and margins, and is now doing what it always does best: bundle the living daylights out of it. That’s how you turn an optional widget into a default expectation. And once AI feels “built in,” that $20 becomes less about price sensitivity and more about habit. Which, in the subscription era, is the whole game.
Bottom line: Microsoft 365 Premium is the rare new plan that actually simplifies the mess and undercuts the competition at the same time. If you live in Office and you’ve been flirting with AI, this is the sweet spot. If you’re loyal to OpenAI’s custom ecosystem, it’s a tougher call. Either way, Microsoft just made the $20 AI tier a lot harder to ignore.
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