Microsoft unifies Copilot into one app — and switches agents to usage-based billing

Microsoft released a major upgrade to its unified Copilot app today, adding Code and Autopilot tabs alongside a redesigned Home tab — and telling customers that Copilot pricing is "evolving," with usage-based billing attached to the app's most important features.

The release marks the end of a fragmented lineup. For the past few years, Microsoft's consumer chatbot and its enterprise AI tools have shared the Copilot brand while shipping with wildly different interfaces and feature sets. Last month, Microsoft began rolling out a single app for both audiences, starting with mobile platforms. Today's upgrade extends that unification to desktop environments, with the same three-tab interface — Home, Code, and Autopilot — regardless of whether you sign in with a personal or a work account.

The stakes are substantial. Microsoft is betting that a single client can serve 90 million consumers who pay for Microsoft 365 out of their own pockets while also satisfying corporations that want AI to work on their proprietary data inside a controlled, compliant cloud. Getting both right determines whether Copilot becomes the default AI layer for the Microsoft 365 installed base or remains a bundle of overlapping tools.

Built for enterprises first

ZDNET, which first reported the launch, notes that the new Copilot was engineered for Microsoft's enterprise customers, not for consumers. The feature set targets organizations already invested in Outlook, Teams, Word, Excel, and PowerPoint — organizations that want AI tools working on company data in a secure environment without sending it to someone else's cloud.

The difference with a work account is access. Tools and agents get secure, compliant access via the Work IQ APIs to data stored in Outlook, SharePoint, OneDrive for Business, Dynamics 365, and other repositories in the Microsoft-hosted enterprise cloud.

But Microsoft sees its consumer base as more than an afterthought. In pre-recorded remarks at a launch event for key customers, Copilot Executive VP Jacob Andreou argued that the consumer audience is "a little bit special." Roughly 90 million customers pay for Microsoft 365 themselves.

"These folks don't want some kind of dumbed-down consumer product; they want the full power that we offer to enterprise users, but in the context of their personal life," Andreou said.

He also claimed measurable improvement in the product itself. "In the last few months, Copilot has gotten actually really good. It's faster, it's more capable, it's more coherent and unified than ever before. … And users have really noticed."

What's in the app

The Home tab merges functions that previously lived on separate Chat and Cowork tabs. Chat handles conversational interaction — drafting a document or looking up answers. Cowork is the agentic side, intended to complete a task from start to finish.

Chief Marketing Officer Jared Spataro highlighted another addition in the announcement post: Office in Copilot. Instead of switching apps, users can ask Copilot to create a launch plan in Word or a budget in Excel and receive "a real, editable document, workbook, or presentation," available for editing and collaboration inside the Copilot app, alongside the conversation.

One Home tab feature is not shipping today. A Today view — described by Microsoft as a "proactive, personalized command center across mail, calendar, Teams threads, meetings, and tasks. It shows you what you missed, what needs attention now, and what can wait" — enters private preview in October in Copilot, and will also come to Outlook and Teams.

Code: GitHub Copilot technology, Microsoft's cloud

The Code tab puts Microsoft directly into competition with the AI coding-agent market, where Anthropic's Claude Code currently leads. Microsoft says Code is "powered by the same underlying technology as GitHub Copilot [and] runs in a sandboxed environment" hosted securely in the Microsoft 365 tenant.

That architecture is a sharp contrast to Claude Code, which runs locally, inside isolated environments like containers or virtual machines. Microsoft's cloud-based approach is designed for customers in regulated industries who worry about compliance and governance when data leaves a centrally managed cloud and lands on local workstations.

Code builds apps, trackers, dashboards, and automations from prompts. The resulting apps run directly in Copilot on a new platform called the Microsoft Copilot Managed Runtime, managed as part of the Microsoft 365 tenant. Microsoft said it plans to open the platform to third-party tooling and to professional developers.

The feature is rolling out to Microsoft's frontier customers shortly, with broad availability "in the coming weeks." Microsoft 365 Premium and Pro subscribers get access later this year.

Autopilot: an agent with its own Outlook account

Autopilot, previously called Scout, is Microsoft's entry in the autonomous agent space. Andreou was blunt about the governance problem such agents pose: they are "absolutely terrifying to an IT admin or somebody who's trying to maintain a business posture."

Microsoft's answer is to treat the agent as a "digital teammate" — with its own memory, its own computer, and its own Outlook and Teams accounts — managed by IT with permissions and an audit trail, just like any other employee. The biggest difference, per the company, is that it doesn't sleep.

The pricing question

"We're evolving Copilot pricing," Microsoft said in today's announcement — words ZDNET notes are guaranteed to cause heartburn for anyone responsible for P&L in a large enterprise.

The new Copilot runs on two financial models. A user subscription license (USL) covers chat-based features, Office app integrations, and model selection at a fixed monthly price. Anything involving agents requires usage-based billing (UBB): Cowork, Code, Autopilot, and the new long-running agentic features all fall under that meter.

There are guardrails, at least initially. Usage-based billing services ship turned off by default, and administrators can define spending policies and spending limits as part of deployment.

In a separate announcement, Microsoft detailed a set of Agent 365 tools for managing costs and measuring benefits, grouped under a "FinOps for AI" umbrella. Admins get detailed spending reports; end users can monitor credit usage and check remaining credits directly in Copilot.

The two questions that will decide adoption — how much this costs at scale, and what payoff enterprises actually see — remain unanswered. ZDNET's verdict is blunt: no one knows. Not even Copilot.

That uncertainty lands as enterprises move from AI pilots to budgets. ZDNET separately reports that nearly 70% of workers now use AI regularly, that many get no time to upskill, and that 62% of businesses seeing AI ROI can't handle the storage demands it creates. A metered billing model on Copilot's core agentic features gives Microsoft a way to monetize that usage — and gives enterprise buyers a new line item to scrutinize when the first invoices arrive.