Microsoft unveils 365 E7 suite & Agent 365 for AI control

Microsoft has announced updates to Microsoft 365 Copilot that put more emphasis on AI agents, model choice, and central governance for organisations automating work across their workforce.

Microsoft 365 Copilot is moving beyond assistant-style interactions to agent-based features that can take actions and complete multi-step tasks. Microsoft also introduced a new bundle, Microsoft 365 E7, which combines Microsoft 365 E5, Microsoft 365 Copilot, and Agent 365 with security and identity products.

Agent focus

A key change is a push towards "agentic" experiences inside core Microsoft 365 apps. The next generation of Copilot agent experiences is rolling out in Word, Excel, PowerPoint, and Outlook, alongside an updated Copilot Chat experience. Copilot Chat was previously referred to as "agent mode".

Microsoft also outlined Copilot Cowork, now in research preview, developed in close collaboration with Anthropic. It uses the technology behind Claude Cowork and is designed for long-running, multi-step work that unfolds over time.

Microsoft also highlighted what it calls a "model-diverse" approach for Copilot. Under its Frontier programme, customers will be able to choose models inside Copilot Chat, with Anthropic's Claude available alongside the latest OpenAI models.

Control plane

Another part of the announcement centres on Agent 365, which Microsoft describes as a control plane for AI agents. It is slated for general availability from May 1 at $15 per user, with local pricing still to come.

Agent 365 is positioned as a way for IT and security teams to observe, govern, manage, and secure agents across an organisation, using the same infrastructure, applications, and protections already used to manage users.

Judson Althoff, CEO of Microsoft Commercial, linked the control-plane approach to concerns about rapid agent roll-outs across enterprises.

"The speed of agent development and proliferation tells us customers see value, but without guardrails the pace of adoption turns into blind spots, diminished ROI and real security risk," said Althoff.

Microsoft also shared metrics from internal adoption and early customers. Althoff said "tens of millions of agents have appeared in the Agent 365 Registry" during two months of preview. He added that Microsoft has visibility into more than 500,000 agents inside the company, and that "agents have been generating more than 65,000 responses every day for employees" over the past 28 days.

New bundle

Microsoft 365 E7: The Frontier Suite is due to become generally available from May 1 at $99 per user, with local pricing still to come. The suite unifies Microsoft 365 E5, Microsoft 365 Copilot, and Agent 365, and includes Microsoft Entra Suite and advanced security features across Defender, Intune, and Purview.

Microsoft said E7 integrates with applications and the security stack customers already use. The suite is powered by Work IQ, described as an intelligence layer tied to organisational work context that informs Copilot and agents.

Althoff framed Work IQ as a differentiator from basic content generation.

"I often say that zero-shot artifact creation is nothing more than a parlor trick," he said.

Work IQ is intended to reflect how work happens inside an organisation, including who collaborates with whom and the content people use together. Microsoft said this context is embedded in tools people already use, and sees it as a basis for improved accuracy and trust in Copilot output.

Adoption signals

Microsoft also pointed to growth in Copilot usage. Althoff said Microsoft delivered its "strongest quarter yet with Copilot", with paid seats up more than 160% year on year and daily active usage up tenfold. He also said the number of customers deploying Copilot at significant scale-defined as more than 35,000 seats-tripled year on year.

Microsoft cited deployments and investments including Mercedes Benz, NASA, Fiserv, ING, the University of Kentucky, the University of Manchester, the US Department of the Interior, and Westpac. It also said 90% of the Fortune 500 now uses Copilot.

Microsoft is pitching the combination of agent features, governance tools, and security packaging as a shift from experimentation to broader enterprise deployment.

"Companies do not want or need more AI experimentation. They need AI that delivers real business outcomes and growth," said Althoff.