Microsoft's AI Revolution: $99/mo E7 Brings Copilot Cowork and Agent 365
Yesterday, Microsoft announced the next big steps in their, I mean, everyone's AI journeys in the M365 space!
Namely, we now know that Agent 365 is going to cost $15/user/month. It's still very unclear what do you get with the price exactly - but at least there's now a number!
Additionally, Microsoft launched the new Microsoft 365 E7 license, which includes the aforementioned Agent 365, the classic Microsoft 365 E5 suite, and of course Microsoft 365 Copilot licenses monthly for a measly $99 per user per month.
And in case that wasn't enough excitement for you, the Copilot experience in Office apps should be more agentic than it's been so far, and document creation capabilities won't be as ham-fisted and limited as they're now.
Copilot does have ways to go...
It's mind-boggling to see how asking for "fix the typos in the file please" means Copilot will create a new file, copy the content, possibly fix the typos there, and then ask you to download the new file and replace the old one with it.
Not the experience I'd expect for a premium product from Microsoft while working on Microsoft Office documents in Microsoft 365.
But the optimist in me is hopeful that in this "wave 3" Microsoft is getting it right - and the competition by Anthropic, Google, and others is actually going to push Microsoft to ship useful AND usable features in the coming months :)
And talking about Anthropic...
Anthropic recently unveiled Claude Cowork, their answer to Microsoft's AI assistant offerings.
Unlike Copilot, which has (d)evolved into a mismash of unrelated, siloed per-app or per-agent experiences, Claude Cowork aims to be a single, cohesive assistant that integrates with your workflow (instead of your apps) by understanding context across multiple applications and maintaining persistent project memory.
It can chain together complex operations - like updating a spreadsheet, sending notifications to team members, and creating summary reports - all in one go.
To be fair, Anthropic has kind of achieved this by ignoring everything that Microsoft outlines as the unique strengths of M365 Copilot - whereas Copilot runs in the cloud and has secure, permission‑aware and security-trimmed access to your emails, files, meetings, chats, documents, and organizational knowledge to try and ground all of the answers in your actual work context (also called "Work IQ" now), Claude Cowork runs locally (the app, not the reasoning!) and appears to use your files and data - both locally and in the cloud by using connectors - only scantily to ground its answers.
But when it does use them, it's powerful. It looks like Anthropic have nailed dealing with Microsoft Office documents (of Office Open XML document format) - being able to create and modify (them) documents easily, whereas Copilot has been struggling with that for a while now.
What do I mean by "struggling"? Well - here's a fun example:
"Hey Copilot, update my sales deck"
Here's the classic sample that could be out of any Microsoft marketing video - you have a sales deck, and you want to update the numbers in it. So you ask Copilot to do that for you:
Copilot is happy to oblige! It proudly proclaims:
But how well did it fare? Let's see...
Here's what the original deck looks like:
And here's the deck Copilot came up with:
Splendid work! Amazing design, very creatively reimagined. It shares exactly none of the colors, fonts, or styles of the original deck.
And before you ask - the original had the master slide set up correctly, so it wasn't a case of Copilot not having stuff to work with.
Sometimes I wonder if Copilot is actually trying to be helpful, or if it's just trolling me at this point... 😅
That said, I'm happy to see Microsoft stepping up their game! This space moves quickly: Claude Cowork was launched in mid-January, and Copilot Cowork will be available for early adopters already at the end of March.
For those interested in OpenAI's future, I suppose it tells something that both Copilot and Claude Cowork are powered by Anthropic's models...
Value proposition and pricing
Microsoft's new E7 license, which includes Agent 365, the premium Entra Suite, and M365 Copilot, is priced at $99 per user per month. This is of course a significant increase from the previous E5 license, which was priced at $57 per user per month.
But if you regard Agent 365 ($15 per user per month), Entra Suite ($12 per user per month) and Copilot ($18-30 per user per month) as worth your money, it might be worth the investment for some organizations.
And if you do the math: $57 + $15 + $12 + $18-30 = $102-114.
For organizations that are already using E5 and Copilot, and consider Agent 365 and Entra Suite to be valuable additions, the E7 license could be a cost-effective way to get all of these features in one package.
Is this realistic for most organizations? Probably not - at least, not yet.
But for those that are heavily invested in the Microsoft ecosystem and see the value in these new features, it could be a compelling option.
Conclusion
We finally have the long-awaited E7 license, coupled with the latest innovation in Microsoft's AI offerings. The M365 Copilot's commercial adoption, while perhaps somewhat lackluster, is still market-leading - and we'll probably see limited but not insignificant adoption of Microsoft 365 E7 in the coming months.
References
... and further reading :)
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