Microsoft has been positioning Copilot as the “UI for AI.” The company has already launched several variants of the GPT-4o-powered assistant for business and personal users. Now, as the next step in this work, it is launching Microsoft 365 Copilot Chat — a rebranded version of its free AI chat experience for businesses, enhanced with agentic capabilities.
Available starting today, the offering is designed to give businesses an easy way to explore most, if not all, of the capabilities of the more full-featured Microsoft 365 Copilot, which is priced at $30 per user per month. Although the experience is free, there is a notable caveat: The agentic capabilities promising task automation will work only on a consumption-based model.
The goal here is pretty obvious: Microsoft wants to give its commercial customers a taste of what it has on offer in the paid version of Copilot. If, with powerful features like agents, the company can make using Copilot a daily habit of Microsoft 365 users — from customer service representatives to marketing leads to frontline technicians — those users might eventually turn to the paid plan.
This development is not a surprise given that the rollout of Microsoft 365 Copilot has been reported to be far from perfect, with some enterprises describing it as expensive and complex to implement due to security concerns.
For its part, Google continues to move ahead with Gemini for Workspace, positioning it as an affordable, easily accessible AI for work.
What to expect from Microsoft 365 Copilot Chat
Just like the original version, Microsoft 365 Copilot Chat will continue to have a chat interface, where users will be able to input their queries and get answers from AI.
The model under the hood, GPT-4o from OpenAI, will provide information grounded in the web, allowing users to do market research or prepare strategy documents. It even supports file uploads, enabling users to seek summaries, analyses or suggestions from documents, and image generation for use cases like social media marketing.
But the real deal is support for AI agents. IT admins can now use Copilot Studio to build domain-specific agents and make them available to employees via Microsoft 365 Copilot Chat.
These agents can serve as virtual teammates for employees, helping them automate repetitive tasks, from providing customer information before meetings to monitoring relevant events. They can be grounded using data from the web as well as work data either via Microsoft Graph or third-party graph connectors.
“A customer service representative can ask a customer relationship management (CRM) agent for account details before a customer meeting, while field service agents can access step-by-step instructions and real-time product knowledge stored in SharePoint,” Microsoft notes in a blog post.
By providing access to agents within Microsoft 365 Copilot Chat, Microsoft wants to show businesses the value its AI offerings can bring. However, this experience will not be entirely free.
The agents will be accessible on a consumption-based model, with the total usage being determined according to the number of messages used by an organization.
“You can purchase messages though the Copilot Studio meter in Microsoft Azure, a pay-as-you-go option, for $0.01/message, or via pre-paid message packs priced at $200 for 25,000 messages/month,” the company notes in a separate post.
It’s worth noting here that different kinds of interactions will use up messages differently, with Microsoft Graph-based answers taking up as many as 30 messages or 30 cents.
Taking on Gemini dominance
With this move, Microsoft hopes to squeeze some money out of Microsoft 365 users with basic AI needs while creating an opportunity to convert them into paying customers. It also comes as a counter to Google’s push with the Gemini assistant
The Sundar Pichai-led company has just announced that Gemini will be available for free within its Workspace apps, including Gmail, Docs, Sheets, Meet, Chat and Vids. This integration is offered to Workspace Business and Enterprise customers, meaning companies paying a base price of $14 per user per month will gain access to AI features inside their core applications.
In contrast, Microsoft 365 users must subscribe to the full Copilot version, priced at $30 per user per month, to access AI features within apps like Teams, Outlook, Word, Excel and PowerPoint.
But Microsoft differentiates itself by offering usage-based agentic AI capabilities. This allows businesses to create custom agents for task automation — a feature currently absent in Gemini.
Ultimately, the choice comes down to the ecosystem you’re aligned with and your specific needs. Google’s approach enables easy access to Gemini within essential business apps but lacks agentic capabilities for now. Meanwhile, Microsoft 365 provides web-based chat and agentic features (on a pay-as-you-go model) but requires a higher investment to unlock AI functionality within its work apps.
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