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

Microsoft 365 Backup Granular Restore

Microsoft 365 Backup has released a new capability called Granular Restore.  M365 Backup has allowed administrators to recover OneDrive accounts and SharePoint Sites.  Up till now, administrators had to restore the entire account or site to get access to specific files of interest.  Now with Granular Restore, admins can perform targeted recovery of specific files by browsing or searching snapshots, selecting specific files or folders, and restoring only what is needed.

 

Reference: https://techcommunity.microsoft.com/blog/microsoft_365blog/microsoft-365-backup-granular-restore-now-generally-available/4515936

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