New M365 Copilot Plugin Registry

There was another very important announcement this week for Microsoft 365 Copilot: a new Plugin Registry is being introduced.

However, what I feel is more important is a shift in terminology. Within the Microsoft 365 Copilot user experience, users will no longer go to the Agents page; they will go to a Plugins page. Why?

Plugins represent a broader set of capabilities that users can use within Microsoft 365 Copilot. Plugins are made up of:

1. Agents (as we know them today)
2. Connectors, which give users access to approved services and data
3. Skills, which are reusable instructions that can be used for specialized work

The goal is to make it simpler for end users to find everything they need to assist them with Microsoft 365 Copilot in one place. Additionally, the Plugins page will be consistently available within the Microsoft 365 Copilot app, Microsoft 365 apps (Word, Excel, and PowerPoint), and SharePoint.

In support of this change, a new Plugin Registry is being provided for administrators to manage how all agents, connectors, and skills are made available to end users. This new registry management capability is available through the Agent 365 management experience. Administrators can review plugins built by Microsoft, customers, and partners through a single experience. They can also enable or disable plugins for users or groups and control how users gain access to them

Reference: https://techcommunity.microsoft.com/blog/microsoft-copilot-blog/introducing-the-plugin-registry---one-place-to-discover-and-govern-plugins-for-m/4559682

New M365 Copilot Pricing Model Notes

Below is a reference to an excellent article about the new pricing models coming to Microsoft 365 Copilot. Here are my takeaways from reading it.

• With the introduction of agentic AI capabilities, a monthly subscription alone is no longer sufficient.  There are two categories of AI usage: Everyday and Advanced.
• Everyday AI will continue to be offered at a fixed monthly subscription price. Unlike other vendors, Microsoft does not meter this usage.  Users can have as many chats as they want using internet and Microsoft 365 data under that fixed price.
• Advanced AI involves agentic capabilities in which users delegate work to AI. Think of it as hands-off work that AI performs on the user’s behalf, including long-running, complex, multistep workflows. Capabilities such as Cowork, Code, and Autopilot will require usage-based billing (UBB) through Copilot Credits. This cost is in addition to the monthly Microsoft 365 Copilot subscription.
• Customers may initially experience sticker shock, but this is a fair way to charge for complex AI usage. Below is a helpful chart comparing Microsoft, Anthropic, and ChatGPT. As you will see, the other providers require usage-based purchases for Everyday AI, and their Advanced AI offerings are more expensive. Ultimately, Microsoft provides access to a broad range of AI solutions at a more efficient price point.
• Microsoft is introducing new controls and reporting capabilities to help customers manage UBB.
• First, UBB is turned off by default and must be enabled by an administrator through a spending policy.
• Spending policies allow administrators to set budgets at the tenant and group levels. They can also set user-level caps within a group and configure warning notifications when thresholds are reached.
• Advanced reporting shows how UBB spending is distributed by user, group, workload, policy, and other dimensions.

Reference: https://techcommunity.microsoft.com/blog/microsoft-copilot-blog/evolution-of-the-copilot-pricing-model/4559416

Grok is coming to M365 Copilot

One of the key differentiators of M365 Copilot compared with other AI solutions is that it gives users the choice to select the model that best fits the work they are doing. Today, users can select from major LLMs provided by companies such as OpenAI, which offers ChatGPT, and Anthropic, which offers Claude Sonnet and Claude Opus.

Microsoft is now expanding its model selection to include SpaceXAI, providing access to models such as Grok.

Grok models will initially be released through the Microsoft Frontier Program and will be available in Word, Excel, and PowerPoint.

Reference: https://techcommunity.microsoft.com/blog/microsoft-copilot-blog/expanding-model-choice-in-copilot-with-grok/4555749

New M365 Copilot Announcements

Microsoft made a major announcement about the “reimagining” of Microsoft Copilot. The major changes are:

• New M365 Copilot Launch Experience
• M365 Copilot’s Expanded Context
• New M365 Copilot Spending Models

New M365 Copilot Launch Experience

Today, you are used to seeing the following options: Chat, Cowork, and Code.

These options are now changing to Home, Code, and Autopilot.

So, what are all these changes about?

The new Home experience brings Copilot Chat and Cowork together. The idea is that you use Copilot Chat as you normally would, and your chats can transition at any time into a Cowork activity, where you delegate tasks for M365 Copilot to execute on your behalf. Home remains the launch point for engaging with Copilot.

Code remains an option; however, in the context of M365 Copilot, it extends solution building beyond developers. It is designed for creating small, purpose-built solutions using natural language. Copilot then chooses an approach and builds the solution for you. Code is powered by GitHub Copilot and runs in a sandboxed environment hosted in your tenant. By leveraging Microsoft IQ, everything you create is grounded in M365 data.

Finally, Autopilot (formerly called Scout) is your digital teammate. You can give it instructions to perform tasks for you over time without having to monitor it. Autopilot can monitor Teams channels and email threads, run recurring work, and more.

M365 Copilot’s Expanded Context

Today, M365 Copilot grounds your business data in M365 through Microsoft IQ. Microsoft IQ has already expanded to give Copilot default access to more data across the Microsoft ecosystem. Fabric IQ incorporates data from more than 10 million semantic models in Power BI. Coming soon, Copilot will also be grounded in Dynamics 365 and Power Platform data.

New M365 Copilot Spending Models

Over the past few months, with the introduction of Cowork and Autopilot, we have learned that the per-user, per-month subscription does not cover the cost of these services. Customers need to purchase Copilot credits.

With this new announcement, Microsoft is providing greater clarity about this model, along with new solutions to help organizations manage costs.

First, customers will continue to purchase M365 Copilot either as an add-on or through the E7 license. This has a set subscription cost, and no credits need to be purchased. Think of this as “Everyday AI” usage, which has a fixed, predictable cost.

Second, there is “Advanced AI,” in which automation and autonomous AI assist users. These capabilities can perform long-running, complex activities that assist users, and they require a usage-based model to cover the cost of running them. Agentic AI capabilities such as Cowork, Code, and Autopilot all fall under this category.

To help customers manage this spending, which is not a fixed cost, Microsoft is providing new cost-management capabilities. Admins can establish spending policies to control costs. For instance, they can create thresholds, implement approval processes for requesting access to credits, and create groups of users with access to specific credit thresholds. Reporting is also available, allowing administrators to review credit usage, determine where value is being realized and where it is not, and restrict access to credits for functions that are not delivering value.

Reference: https://blogs.microsoft.com/blog/2026/09/25/introducing-the-new-copilot-with-home-code-and-autopilot/  

New M365 Copilot Capabilities for GCC, GCCH and DoD Clouds

Microsoft 365 Copilot has gained several major new capabilities across the GCC, GCC High, and DoD clouds.

• GPT-5.6: The latest model is now available across all government cloud environments.
• Memory and personalization: Microsoft 365 Copilot does not learn from a customer’s data, but these capabilities let it tailor experiences to each user.
• Edit with Copilot in Word, Excel, and PowerPoint: Copilot can now work alongside users in government cloud apps, making inline changes and helping refine sections or update content throughout a document.
• Expanded Copilot Chat basic with Outlook: Users without a Microsoft 365 Copilot add-on license can now use information from their email, calendars, and meetings.
• Updated Copilot Notebooks.
• Refreshed Copilot app.

Reference: https://techcommunity.microsoft.com/blog/publicsectorblog/whats-next-in-microsoft-365-copilot-for-government/4555457

M365 G7 Available in GCC on Oct 1

There was a big announcement this week.  M365 G7 will be available in the Microsoft GCC cloud starting October 1st 2027.  This is super exciting as this builds on top of M365 G5 with M365 Copilot, Agent 365, Entra Suite, and advanced Defender, Intune and Purview capabilities to securely deliver all AI platforms to an organization.

References: https://www.microsoft.com/en-us/microsoft-cloud/blog/us-government/2026/09/15/introducing-microsoft-365-g7-intelligence-trust-for-the-mission-ahead/

Microsoft Teams Phone Agent

Microsoft 365 has introduced a new agent called Teams Phone Agent. This tool allows organizations to build customer voice agents that integrate seamlessly with Teams Phone. It's especially useful for businesses that interact directly with customers. The Teams Phone Agent can follow instructions and respond to callers efficiently. Its features include:

• Handling Question and Answer scenarios by connecting with specific knowledge bases, allowing it to provide instant responses without keeping callers waiting. It also assists callers outside regular business hours.
• Managing Appointment Scheduling, helping users book, confirm, or modify appointments.
• Offering conversational routing and intelligent transfers, which are much more effective than traditional auto attendants, as it routes callers directly to subject matter experts without needing human intervention.
• Supporting multilingual interactions in over 60 languages.

To start using this service, you’ll need to enroll in the Frontier program.

Reference: https://techcommunity.microsoft.com/blog/microsoftteamsblog/engage-customers-with-teams-phone-agent-and-custom-voice-agents-built-in-copilot/4526829

More LLM Models Available in M365 Copilot

M365 Copilot capabilities are landing in the cloud at a rapid pace.  

On May 2nd, I wrote about Anthropic Claude Opus 4.7, GPT 5.5 Thinking, and ChatGPT Images 2.0 models are now available: https://www.astaticstate.com/2026/05/new-models-available-for-m365-copilot.html

Fast forward today, we have five more updated models added.

GPT-5.5 Instant

Microsoft's fast-response model for everyday work, optimized to provide more accurate, concise answers with improved image analysis and STEM capabilities while reducing unnecessary verbosity and follow-up questions.

Reference: https://techcommunity.microsoft.com/blog/microsoft365copilotblog/available-today-gpt-5-5-instant-in-microsoft-365-copilot/4517084

Anthropic Claude Opus 4.8

Optus 4.8 is designed for complex, multi-step coding tasks and long-horizon agent work with improved tool selection and closer adherence to following instructions.  Plus it is also stronger at drafting documents, data analysis and presentations when combined with Work IQ.

Reference: https://techcommunity.microsoft.com/blog/microsoft365copilotblog/available-today-anthropic-claude-opus-4-8-in-microsoft-365-copilot/4523405

Anthropic Claude Fable 5

Claude Fable 5 is Anthropic's most advanced model for tackling complex, multi-step knowledge work, research and analysis. When used in Microsoft 365 Copilot, it combines Fable 5's reasoning capabilities with Copilot's access to organizational context from emails, files, meetings, and chats to help users complete more sophisticated work.

Reference: https://techcommunity.microsoft.com/blog/microsoft365copilotblog/available-today-anthropic-claude-fable-5-in-microsoft-365-copilot/4526832

Anthropic’s Claude Sonnet 5

Anthropic's Claude Sonnet 5 is a frontier AI model available in Microsoft 365 Copilot that is optimized for agentic designed for agentic work across documents, spreadsheets, and presentations. When combined with Copilot's Work IQ grounding, it can reason over your organization's files, meetings, chats, and business data to help plan, create, and refine high-quality work products while staying within the Microsoft 365 Copilot experience.

Reference: https://techcommunity.microsoft.com/blog/microsoft365copilotblog/available-today-anthropic%E2%80%99s-claude-sonnet-5-in-microsoft-365-copilot/4532188

OpenAI GPT-5.6

OpenAI's GPT-5.6 is now available in Microsoft 365 Copilot across Word, Excel, PowerPoint, Copilot Chat, and Copilot Cowork, where it has been optimized specifically for knowledge work and is the preferred model for many Copilot experiences.

Reference: https://techcommunity.microsoft.com/blog/microsoft365copilotblog/available-today-openai%E2%80%99s-gpt-5-6-in-microsoft-365-copilot/4533152

M365 Copilot Cowork and Microsoft Scout Comparison

Are trying to wrap your head around what are the differences between M365 Cowork and Microsoft Scout?  Here is a nice table explaining the difference between them.

	M365 Copilot Cowork	Microsoft Scout
Primary purpose	Get a specific piece of work done after you ask it	Continuously keep work moving without being asked
Interaction model	User-driven ("Go do this task")	Proactive / always-on ("Watch for things that need attention")
Best for	Complex, multi-step projects and workflows	Ongoing coordination, monitoring, triage, and follow-up
Cadence	Minutes to hours	Continuous
Control model	User remains in the driver's seat with checkpoints and approvals	More autonomous, acting proactively within guardrails
Data access	M365 and connected enterprise systems	M365, desktop, browser, local files, and tools
Underlying AI / Architecture	Copilot Cowork runs on Anthropic models, including Opus 4.8 and Sonnet 4.6. In Frontier, customers can use GPT 5.5, with Cowork 1 coming soon	OpenClaw-based Autopilot. Microsoft's first Autopilot agent, with Work IQ used to build context, memory, priorities, and work patterns over time.
Examples	Create a project launch plan, prepare an executive briefing, analyze data, coordinate work across apps	Detect stalled decisions, manage calendar conflicts, prepare meeting materials, monitor deadlines and risks

Microsoft Scout Preview

Microsoft Scout introduces a new category of AI agents called Autopilots, which represent a shift from AI that simply responds to requests toward AI that can continuously help move work forward on a user's behalf. Unlike traditional copilots that wait for a prompt, Autopilots remain active in the background, maintain awareness of a user's priorities, and can take actions across connected systems without requiring constant intervention. Microsoft Scout is the first Autopilot in Microsoft 365, designed to work across Teams, Outlook, OneDrive, SharePoint, calendars, email, contacts, and other work resources while operating under organizational controls and user-defined permissions.

For individual users, Scout is intended to reduce the "work around the work" that consumes much of the day. Rather than simply answering questions, Scout can proactively coordinate meetings, identify upcoming deadlines, reserve focus time on calendars, prepare meeting materials, surface stalled decisions, and help ensure commitments do not fall through the cracks. The goal is to reduce the time spent on administrative coordination, follow-up activities, and context switching across multiple tools. Over time, Scout uses Microsoft's Work IQ intelligence layer to build a deeper understanding of how a user works, which projects are important, and what actions are most likely needed next, allowing it to become increasingly helpful and personalized.

Organizations gain value because Scout extends beyond simple productivity assistance and becomes a mechanism for helping work continue even when employees are focused elsewhere. By automating coordination, follow-ups, deliverable tracking, and other repetitive processes, Scout can help reduce delays, improve responsiveness, and increase consistency across teams. Scout is can keep work moving continuously across files, meetings, messages, and business workflows while maintaining visibility and user oversight. This has the potential to reduce organizational friction, improve execution speed, and allow employees to spend more time on strategic activities rather than manual coordination and administrative effort.

Security and governance are central to the Scout design. Microsoft states that Autopilots operate using their own identity while remaining constrained by the permissions, policies, and governance controls established by the organization. Scout only accesses data and services users are already authorized to access and works within existing Microsoft 365 identity, authentication, and permission models. Sensitive actions can require user approval before execution, ensuring that users remain in control of important decisions. Microsoft also emphasizes enterprise-grade security controls, tenant isolation, auditability, policy enforcement, and integration with existing Microsoft 365 security and compliance investments. As a result, Scout does not create a separate security model; it extends the identity, permissions, and governance framework organizations already use in Microsoft 365.

Microsoft Scout is available in Preview through the Frontier Program.

Reference: https://www.microsoft.com/en-us/microsoft-365/blog/2026/06/02/introducing-microsoft-scout-your-always-on-personal-agent/

New M365 Copilot Design and User Experiences

I am little late in posting this, but at the end of May 2026, a new M365 Copilot design was launched.  

Here is a summary of those changes:

• Task-aware prompt experience: The prompt area evolves from a simple text box into a workspace that adapts to the task being performed, surfacing relevant tools and controls directly beneath the prompt.
• Larger, more expressive prompt surface: Users now have more space to describe their needs and work naturally with Copilot.
• A single Copilot entry point across Microsoft 365: Microsoft is creating a common Copilot entry experience across Microsoft 365 applications that can suggest relevant actions based on context.
• Progressive disclosure of capabilities: The interface begins with a clean, focused design and reveals additional capabilities only when they are needed.
• Simplified navigation: A new expandable and collapsible left navigation pane provides access to agents, conversations, and history while preserving workspace focus.
• Improved work continuity: Shared pinning capabilities and expanded session recall make it easier to return to ongoing work and previous conversations.
• Faster and more responsive experience: The redesign focuses not only on appearance but also on improving responsiveness and overall performance.
• Greater emphasis on output quality: Microsoft states that the most important aspect of the experience is no longer the interface itself, but the quality of the output including tone, structure, readability, usefulness, and trustworthiness.
• More connected and adaptive Copilot experience: The redesign is intended to make Copilot feel like a connected system that moves with users across tasks, teams, applications, and workflows.

Probably, the biggest change customers will see is the Work/Web tab is now gone.

Reference: https://www.microsoft.com/en-us/microsoft-365/blog/2026/05/28/introducing-a-new-design-for-microsoft-365-copilot/

M365 Copilot Work IQ APIs are now GA

Microsoft announced that the M365 Copilot Work IQ APIs will become generally available in June 2026. These APIs make it possible for agents built on any platform to access Work IQ and integrate it into their own solutions.

What are the APIs?

1. They improve result quality by going beyond simple prompt-and-response interactions.  Work IQ uses the semantic index with ultra-low latency, personal memory, organizational skills, structured schema, and business-specific knowledge tuning.
2. They are optimized for agent speed, reducing the number of required round trips.
3. They are efficient APIs that reduce the number of tokens needed to retrieve context.
4. They are designed to support agent-scale usage, including continuous, high-frequency, multi-step operations that require high throughput.
5. They operate within Microsoft 365’s security and governance model, helping developers ensure returned data respects customer controls and policies.

The Result?

As a result, developers can safely bring Microsoft 365 data and context into their agents. This goes beyond a basic connector: it is an intelligent, optimized, and secure AI-scale solution that extends the value of M365 Copilot Work IQ to line-of-business agents, regardless of the platform they are built on.

Pricing

To use the Work IQ APIs:

• Customers must have M365 Copilot Credits, which can be purchased in bundles or consumed on a usage basis. They can also use cost management dashboards and policies to monitor and manage credit usage.
• Users also need an active M365 Copilot license, which must be maintained to access Work IQ.

Reference: https://www.microsoft.com/en-us/microsoft-365/blog/2026/06/02/announcing-the-new-work-iq-apis/ 

M365 Copilot Cowork is GA

One of this week’s major announcements is that Copilot Cowork, previously in preview for the past few months as a Frontier capability, is now generally available for all tenants.

What is Copilot Cowork

If you are not familiar with Copilot Cowork, it moves users beyond simple prompts and responses by enabling them to delegate long-running, multi-step work that progresses over time. It uses Microsoft Work IQ to understand organizational context across email, meetings, chats, files, and other sources, then creates a plan, reasons across tools, and executes tasks with visible progress. Users remain in control and can review, pause, stop, or redirect actions at any point. Unlike traditional chat-based AI, Cowork is designed for agentic execution, allowing Copilot to coordinate work across multiple applications. Cowork also supports a multi-model design, enabling the best model to be used for the work at hand. Today, Copilot Cowork can leverage Opus 4.8, Sonnet 4.6, and GPT 5.5, with Cowork 1 coming soon.

One important point to note is that Cowork has a different pricing model. Customers must first have a Microsoft 365 Copilot license, and Cowork usage is then billed based on the tasks users run. In other words, Cowork can add costs beyond the per-user monthly Microsoft 365 Copilot license. Billing is usage-based, denominated in Copilot Credits, and task pricing is calculated from four inputs: model use, context retrieval, tool calls, and runtime.

If that seems a little confusing, here are some good examples of how to put that in context.  Below are three of the most common patterns that have been observed.

Copilot Cowork Pricing

Customers can use built-in controls to manage Copilot Credit usage. They can define who has access to Cowork, set spending limits at the tenant, group, or user level, and allocate more credits to users who are expected to use Cowork heavily. Cowork is off by default, and administrators can configure usage alerts, approve requests for additional credits, and use reporting to monitor consumption and adjust policies over time.

There are two payment options for Copilot Credits. Pay-as-you-go pricing is $0.01 per Copilot Credit, while P3 lets customers purchase credits in volume at a discounted rate.

Reference: https://www.microsoft.com/en-us/microsoft-365/blog/2026/06/16/copilot-cowork-is-now-generally-available/

New Models Available for M365 Copilot

In late April 2026, there were several model updates become available to M365 Copilot.

Anthropic Claude Opus 4.7

User are now able to select Anthropic’ s latest Claude Opus 4.7 in Copilot Cowork, Copilot Studio, and Copilot in Excel.  Opus 4.7 is designed to faster, more precise and handles complex, multi-step work with rigor.

GPT 5.5 Thinking

GPT 5.5 will be available for Microsoft 365 Copilot in Copilot Chat, Word, Excel, and PowerPoint. With Work IQ, GPT 5.5 will deliver more focused, relevant, and complete outputs for analysis, creation, and complex work.

ChatGPT Images 2.0

ChatGPT Images 2.0 is rolling out to Copilot in PowerPoint and coming soon to Copilot Chat.

References:

https://techcommunity.microsoft.com/blog/microsoft365copilotblog/available-today-gpt-5-5-thinking-and-chatgpt-images-2-0-in-microsoft-365-copilot/4514243

https://techcommunity.microsoft.com/blog/microsoft365copilotblog/available-today-anthropic-claude-opus-4-7-in-microsoft-365-copilot/4511666

M365 E7 is GA

As of May 1, 2026, the new Microsoft 365 E7 with Agent 365 is now Generally Available (GA).  As a reminder, M365 E7 is made up of the following:

• M365 E5: enterprise grade productivity, identity, and security services.
• M365 Copilot: AI integrated productivity capabilities.
• Microsoft Entra Suite: Identity and network access controls that secure employee use of all apps and AI
• Microsoft Agent 365: Control plan for governing, observing, and securing AI agents at scale.

Reference: https://techcommunity.microsoft.com/blog/microsoft_365blog/microsoft-365-e7-and-agent-365-are-now-generally-available/4516295

New M365 Copilot Critique and Council features

M365 Copilot Researcher agent is adding new capabilities for deep, complex research. There are two new features: Critique and Council.

Critique is a multi-model research workflow that lets you use different models including to research.  This allows you to use both Anthropic and OpenAI to generate and improve an answer.  For instance, one model plans the work, retrieves information, and drafts the response; a second model reviews and refines the draft to produce the final output. Then the second model focuses on review and refinement, acting as an expert reviewer of the final research response. 

Council is designed for side-by-side model comparisons. Council is different approach and is designed for side-by-side comparison across multiple models.  In this case, Councill will run both Anthropic and OpenAI in parallel and will present a report shown at the end as a comparison between both models.  Once this is completed, a dedicated judge model evaluates both reports and then uses a judge model to synthesize the key findings.

Reference: https://techcommunity.microsoft.com/blog/microsoft365copilotblog/introducing-multi-model-intelligence-in-researcher/4506011

New M365 Copilot DLP Capabilities

Microsoft 365 Copilot now includes new data loss prevention (DLP) capabilities customers should be aware of. Until now, I have typically recommended using SharePoint Advanced Management (SAM) to reduce oversharing and Sensitivity Labels to prevent Copilot from processing sensitive documents even when users have access. There are some new M365 Copilot DLP capabilities that customers should know about.  Today, there are some really good things customers can figure with M365 Copilot to protect against data loss.  Up to now, I have usually talked with customers about implementing SharePoint Advanced Management (SAM) to restrict oversharing of data plus I have recommended implementing Sensitivity Label policies to restrict sensitive documents from being processed by M365 Copilot (even if the user has legitimate access to the data).

A new preview feature lets you apply DLP policies to Copilot prompts themselves, blocking prompts that contain configured sensitive information types. This real-There is a new feature that is in preview that enables you to create DLP policy to protect sensitive information types from even being submitted in M365 Copilot Prompts.  This real time control helps reduce data leakage and oversharing. You can also   Users would not be allowed to even allow prompts to continue if there is sensitive information present.  You can also create policy that would allow users to work with sensitive content but restrict where the prompt can be sent for example, limiting it to internal processing only.

References:

https://learn.microsoft.com/en-us/purview/ai-m365-copilot 

https://learn.microsoft.com/en-us/purview/dlp-microsoft365-copilot-location-learn-about

https://www.microsoft.com/en-us/microsoft-365/roadmap?searchterms=515945

https://www.microsoft.com/en-us/microsoft-365/roadmap?filters=&searchterms=548671

https://techcommunity.microsoft.com/blog/microsoft365copilotblog/what%E2%80%99s-new-in-microsoft-365-copilot--march-2026/4506322

https://techcommunity.microsoft.com/blog/microsoft365copilotblog/latest-enhancements-for-copilot-security-management-and-analytics/4508476

New M365 E7 Notes

By now, many of you have heard about the major announcements about the new M365 E7 offering.  There are a couple of my notes around all the new capabilities.

Work IQ

• A key announcement is Work IQ, an intelligence layer that helps M365 Copilot understand your working habits, collaborators, and shared content. Work IQ personalizes Copilot to fit your needs.
• Work IQ consists of three interconnected layers: data, context, and skills/tools.
• Its purpose is to enhance Copilot by working with any foundational model chosen by users, such as Open AI or Anthropic.
• Work IQ's foundation lies in secure access to both your structured and unstructured data through the M365 graph, along with any business data reached via Copilot Connectors outside of M365.
• The Context component grounds Copilot in M365 data, providing baseline understanding of your activities. It considers factors like your skills, ongoing projects, collaboration frequency, your network, critical tasks, and more. The Memory feature allows you to mark specific data for recall, while implicit memory uses your history to generate answers. Work IQ also assesses your activity throughout M365 to build context and maintains a business perspective on your role.
• Work IQ offers agentic skills, which are specialized instructions for tasks—such as scheduling meetings or finding notes—alongside tools that Copilot uses to carry out these tasks.
• Integrated across all Copilot applications and experiences, Work IQ enables Copilot to deliver contextual information tailored to your prompts. You can ask about your manager, projects, processes, and more, and receive responses relevant to your situation.

Copilot Cowork

• Anthropic (Claude Cowork) has now been integrated into M365 Copilot. Copilot Cowork enables advanced, long-running, multi-step workflows that extend beyond simple prompts and responses. Coupled with Work IQ, users can now delegate substantial tasks to Copilot, allowing for oversight of ongoing work.
• Cowork is capable of decomposing complex requests into actionable steps, reasoning across multiple tools and files, and completing assignments on behalf of the user.
• Cowork’s operations are transparent and observable; users can monitor progress, provide guidance, halt, or modify tasks as necessary throughout the workflow.

Agents in Chat

• Chat in Copilot serves as a starting point, enabling users to seamlessly create documents, spreadsheets, presentations, and more based on their interactions. There's no need for users to copy and paste or switch between different tools, ensuring a streamlined workflow and helping them accomplish tasks efficiently.
• Copilot simplifies building agents for everyday tasks using Agent Builder, while Microsoft Copilot Studio supports the development of more advanced business processes.

Multi-model Intelligence

• As noted previously, the launch of Wave 3 demonstrates ongoing commitment to Microsoft's vision of providing users with flexibility rather than limiting them to a single model. Claude is currently unavailable as a primary chat option for users, while OpenAI models remain accessible.

Agent 365

• A key feature introduced with M365 E7 is the Agent 365 solution.
• Customers should expect that agents will become widespread on all platforms, not just within Microsoft environments.
• Agent 365 serves as a centralized control plane for managing enterprise-level agents, allowing organizations to monitor, secure, and govern every agent throughout their operation.
• In essence, managing agents resembles managing users, utilizing familiar tools and strategies already in use by organizations today.

Why Microsoft Included Entra Suite in Microsoft 365 E7

• To enable AI agents to operate under Zero Trust: As AI moves from assistance to action, Microsoft needed a way to apply identity, access controls, and policy enforcement not just to users, but also to AI agents operating across the environment.
• To extend identity governance beyond humans to non‑human actors: Entra Suite allows organizations to apply lifecycle management, least‑privilege access, and conditional access to AI agents the same way they do for employees, apps, and services.
• To make large‑scale AI adoption auditable and defensible: Agent actions can be logged, monitored, and governed through Entra, Defender, and Purview—supporting compliance, investigations, and regulated industry requirements.
• To prevent “shadow AI” as agents proliferate across the business: Entra Suite provides centralized identity and access governance so agents created by different teams don’t operate outside security and policy boundaries.
• To complement Agent 365 with identity‑level enforcement: Agent 365 provides visibility and control over agents, while Entra Suite provides the identity foundation that determines who or what an agent is and what it is allowed to access.
• To move customers from AI experimentation to enterprise execution: Microsoft included Entra Suite to remove the need for additional identity add‑ons and give customers a single, trusted platform to deploy AI safely at scale.
• To align E7 with the “agentic enterprise” strategy: E7 is designed for a future where humans and AI agents work side‑by‑side; Entra Suite is what makes that model secure, governable, and enterprise‑ready.

What comes in E7?

• Think of the new E7 suite as the M365 AI suite.
• First, it brings in M365 Copilot Add-on which previously was an add-on SKU to either E3 or E5.
• Second, it brings in Agent 365 to assist organizations with their enterprise management of agents.
• Third, the Entra Suite add-on is part of the E7 suite.  Entra ID Suite was included in E7 primarily to make large‑scale, governed AI agents viable and defensible in enterprise.

References:

https://blogs.microsoft.com/blog/2026/03/09/introducing-the-first-frontier-suite-built-on-intelligence-trust/

https://www.microsoft.com/en-us/microsoft-365/blog/2025/12/04/advancing-microsoft-365-new-capabilities-and-pricing-update/

https://techcommunity.microsoft.com/blog/microsoft365copilotblog/a-closer-look-at-work-iq/4499789

https://www.microsoft.com/en-us/microsoft-365/blog/2026/03/09/powering-frontier-transformation-with-copilot-and-agents/

M365 Copilot What's New for Jan and Feb 2026

I reviewed the recent updates for both January and February 2026. Below are several noteworthy developments that I observed.

January 2026 >> https://techcommunity.microsoft.com/blog/microsoft365copilotblog/what%E2%80%99s-new-in-microsoft-365-copilot--january-2026/4488916 

• Agent mode is now available in Word, Excel, and PowerPoint, allowing users to edit and refine documents collaboratively with active assistance based on user prompts.
• The introduction of Word, Excel, and PowerPoint Agents streamlines file creation, enabling users to generate new documents with a single prompt through Copilot Chat.
• Voice chats in the Microsoft 365 Copilot application have been enhanced to reference user memory, delivering more personalized results.
• Outlook's interactive voice experience summarizes unread emails and provides hands-free actions such as drafting, deleting, archiving, pinning, and flagging messages.
• Implicit grounding for emails and text allows Copilot Chat to automatically incorporate open emails as contextual sources for prompts. When text within an email is highlighted, Copilot dynamically updates its context to focus solely on the selected text.
• Users are now able to perform common email triage actions in Outlook and the M365 Copilot App using natural language commands. This includes marking messages as read or unread, pinning, flagging, and archiving (e.g., "Flag all unread emails from my manager").
• Automatic replies can now be set up using natural language, enabling users to toggle replies on or off, specify date ranges, and draft response templates efficiently.
• Copilot Excel now supports locally stored workbooks that are not saved on the M365 platform.
• In PowerPoint's view-only mode, users can leverage Copilot to review presentations and pose questions about the content.
• Microsoft Purview integration within the M365 Admin Center enhances security management for M365 Copilot, offering features including oversharing risk assessment, DLP for Copilot policy, and a Copilot Overview screen with suggested administrative actions.
• A new overview and readiness report will soon be available in the M365 Admin Center. The redesigned Copilot overview page offers a centralized, comprehensive, and contextual dashboard for monitoring Copilot across the tenant.

February 2026 >> https://techcommunity.microsoft.com/blog/microsoft365copilotblog/what%E2%80%99s-new-in-microsoft-365-copilot--february-2026/4496489 

• In Copilot Chat, users can pick specific text from Copilot responses and then ask focused follow-up questions about that selection.
• Users have the option to base their Copilot prompts on SharePoint lists or sites by typing a slash “/” followed by the desired location's name.
• In Outlook, users can highlight message text and start a grounded discussion based on what they've highlighted.
• The Project Manager Agent is a new tool that helps users plan, organize, and manage projects with AI-assisted tracking. It will be available for public preview in March.
• Copilot Chat now works alongside Copilot Search, making it possible for users to review previous search results and interact with Copilot simultaneously.
• Teams meeting recaps will soon feature visual highlights with summaries; for example, key recap points may include an image of a slide or a screenshot from a screenshare as part of the notes.
• Customizable Teams meeting recap templates are being introduced, enabling users to personalize AI-generated notes according to their team's workflow. Users specify their preferences, and Copilot follows those instructions.
• New features in Copilot for Outlook allow it to suggest meeting times, and if no suitable options are found, Copilot expands its search and explains the recommendations.
• In Outlook, Copilot can schedule meetings directly from an email thread—simply select “Schedule with Copilot” and the process is handled automatically.
• OneDrive agents allow users to create an agent capable of understanding an entire document set and responding with answers based on that collective content.
• In Copilot Chat, Agent Recommendations offer proactive suggestions to users; for instance, if a specialized agent is available, it will be suggested.
• AI agents can collaborate to complete complex tasks by invoking one another as tools, allowing specialized agents to benefit from each other's expertise.
• The new Power User Report will be added to the Copilot Adoption dashboard, helping you understand how power users, regular users, and non-users are engaging with Copilot.

Copilot in Outlook Help to Manage Meeting Conflicts

This upcoming feature is set to enhance productivity. With M365 Copilot, users can leverage its ability to review Outlook calendar events and manage meeting conflicts efficiently. For example, if multiple recurring meetings are scheduled and it becomes necessary to prioritize a one-on-one session, Copilot can reschedule the individual meeting accordingly. To enable this functionality, simply select “If conflicts arise, let Copilot reschedule this event” in the Outlook meeting invitation and specify which days and times are suitable for rescheduling should a conflict occur.

Reference: https://techcommunity.microsoft.com/blog/microsoft365insiderblog/copilot-can-reschedule-conflicting-events-in-outlook/4471514