Microsoft announced Wednesday that it will discontinue its standalone consumer AI subscription and instead launch a new bundle that merges AI tools with its productivity apps.

The company had introduced Copilot Pro at $20 per month earlier in 2024, while Microsoft 365 Family, covering up to six users with 6 terabytes of cloud storage, costs $12.99 monthly.

The newly unveiled Microsoft 365 Premium tier combines both offerings for $19.99 per month, according to CNBC.

“Other AI tools stop at chat — we deliver that plus so much more,” Yusuf Mehdi, Microsoft’s consumer marketing leader, wrote in a statement.

Tech companies are racing to tap into the surging demand for generative AI, offering tools that can draft documents, produce videos, and more.

Like existing Microsoft 365 subscriptions, Premium allows Copilot integration across Office apps such as Word, Excel and PowerPoint. It also includes higher usage limits than the free version of Copilot, plus access to two advanced AI reasoning agents that were previously available only to enterprise customers.

The announcement comes as Microsoft deepens its AI strategy.

The company has invested more than $13 billion in OpenAI, whose models power Copilot and run on Microsoft’s Azure cloud.

While the two firms are close partners, they also compete in the consumer AI space alongside rivals Google and Anthropic.