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What will Microsoft Copilot cost now that agents are billed by usage?

AI tools

In short

  • Microsoft Copilot now has two pricing models: a fixed licence per user for everyday work, and pay-as-you-go Copilot Credits for agents that carry out tasks on their own, such as Cowork.
  • Your monthly bill depends on how much work you hand to agents. Microsoft does not publish a price per task, so limits are your only real cost control.
  • Set those limits before people start. By default, Microsoft adds new agents to your spending policy automatically.

What will Microsoft Copilot cost your organisation? For chat and drafting in Word, Excel, PowerPoint, Outlook and Teams, it stays a fixed licence per user. Work you delegate to an agent, such as a task Cowork runs from start to finish, is billed by usage in Copilot Credits. The first is predictable. The second is not, unless you make it so.

Whether that second bill stays under control depends on what you configure in the Microsoft 365 admin centre. The key condition: start with a monthly limit and a per-user limit, and switch off the automatic inclusion of new agents. Below is what is changing, what Microsoft itself says about price, and which settings to put in place now.

What is changing in Copilot licensing?

On 25 September Microsoft announced a new Copilot with three parts: Home, where chat and Cowork come together; Code, which lets employees build apps and automations by describing what they need; and Autopilot, an agent with its own name, role and goal that watches channels and runs recurring work. Microsoft 365 Copilot is now called Microsoft Copilot.

The pricing splits in two. In Microsoft's words, a user subscription licence gives you Copilot in Chat and across Word, Excel, PowerPoint, Outlook and Teams, while usage-based billing "lets you have full control to choose models and match cost to value" (Microsoft).

According to the documentation, these services currently fall under usage-based billing (Microsoft Learn):

  • Cowork, which also requires a Copilot licence
  • advanced work in SharePoint and OneDrive, also with a Copilot licence
  • the Work IQ API for custom apps and agents
  • Copilot Managed Runtime, which hosts apps built with Code
  • the Teams Phone Agent

Microsoft says more agents and services will be added "over time".

What does a Copilot Credit cost?

The admin documentation gives neither a fixed price per credit nor a price per task. How many credits a task uses varies, and Microsoft provides a planning model to estimate consumption for your organisation. What a credit costs you is set out in your own agreement.

There are two ways to pay:

  • Pay as you go, through an Azure subscription you connect.
  • Pre-purchase for a year (Copilot Credit Pre-Purchase Plan), with larger discounts for larger commitments. Note that these plans renew automatically by default and cannot be cancelled or exchanged. Anything beyond the prepaid amount continues on pay-as-you-go.

For resellers, Microsoft announced that from 1 December, usage-based billing will be on by default for new Copilot Business licences bought through a Microsoft partner, with a default limit of 4,000 credits per user per month (Microsoft Partner Center).

Worked example. In its documentation on pre-purchased credits, Microsoft assumes a pay-as-you-go rate of $0.01 per credit (Microsoft Learn, Copilot Credit P3). On that assumption, the default limit comes to at most $40 per user per month on top of the licence, or $4,000 a month if a hundred users all reach their limit. This is an example, not a price list: your actual rate and currency are in your agreement.

What is different in the Netherlands and the rest of Europe?

Two things.

First, the 1 December default does not yet apply everywhere. Microsoft lists the Netherlands, Belgium, Germany, France, Italy, Spain and Poland among the countries where the change will "initially not be available". There, you switch on usage-based billing yourself, which gives you time to set up your policies first.

Second, the models. Microsoft switches off Anthropic's Claude models by default for customers in the EU, EFTA and UK, because they are excluded from the EU Data Boundary: data may be processed outside the EU. An administrator can enable them for everyone or for specific groups. Microsoft warns that some features only work when those models are enabled (Microsoft Learn, Anthropic models). If you want to use Cowork, first check which models it uses in your tenant and whether you accept processing outside the EU. That is a decision for whoever owns privacy, not just for IT.

Which settings should you put in place first?

Everything sits in the Microsoft 365 admin centre under Copilot, Cost management, and Microsoft documents the steps (Microsoft Learn, setup). These are the settings that matter most:

  1. A monthly limit on the default policy. "Don't limit monthly spending" is an option. Avoid it until you know your usage.
  2. A per-user limit. Microsoft recommends this itself, to stop one person using all available credits. Users who reach their limit lose access to the agents until the first of the next month, unless they request more credits.
  3. "Auto-apply new services" off. It is on by default, which means new agents and services Microsoft adds come under your policy automatically and can start consuming credits. Switch it off and review each new service yourself.
  4. Start with a pilot group. The default policy covers the whole organisation. You can scope a policy to a security group so that ten or twenty people build experience first.
  5. Alerts and read-only access. Set a threshold at which administrators get an email, and give someone in finance a read-only role on consumption.
  6. A model profile for Cowork. This controls which models and providers Cowork may use, which affects both cost and where your data is processed.

Who owns what employees build with Code?

With Code, anyone can have a tracker, dashboard or automation built. Those apps run on Copilot Managed Runtime, which Microsoft describes as "governed by IT but easy for everyone else". Code rolls out first through the Frontier early-access programme; Autopilot starts in private preview.

Building and running both consume credits. So the question for leadership is not only what it costs, but who owns an app that someone builds in an afternoon. Who maintains it when the process changes, and what happens when its maker leaves? Agree on that before the first handy tool becomes indispensable.

When is usage-based billing not the right choice?

If your team mainly uses Copilot to write, summarise and analyse, little changes. That is covered by the licence.

For a fixed process that runs the same way every day, such as hundreds of product descriptions a week or a standard report, a dedicated workflow can be more predictable than an agent that decides afresh how to approach the task each time. You can see at each step what AI does and where a person checks the result. That is the kind of solution we build in an AI workplace. For varied, personal work, Cowork is a sensible fit. It does not have to be one or the other.

Still unknown: how many credits typical tasks use in practice. Microsoft itself notes that its recommended limits may change "over time".

What is a good next step?

Use the Copilot Credit Estimator, linked from Microsoft's Copilot Credits documentation, to make a first estimate for one department. Then set up a policy for a small pilot group, with limits and alerts, and look at actual consumption per task after a month. You will have numbers instead of a guess.

Want to decide which work to hand to Copilot and what is better built as a fixed process? Book a conversation.

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