Software or Work? Microsoft's New AI Pricing Question
5 October 2026
On September 25, Microsoft rebuilt Copilot around three tabs: Home, Code and Autopilot. One could think of it as another redesign, which it is. But I believe the bigger change is around Copilot pricing.
Home is the front door for chatting or handing off a task, with Word, Excel and PowerPoint built in. Code turns a plain English description into a small app. Autopilot is a teammate you give a name, a role and a goal, say running a supplier review, and it chases people for updates while you are away.
For decades Microsoft has priced software per person per month, and chat and the Office apps are billed that way. Anything you delegate, meaning Code, Autopilot and the most advanced models, is now billed by usage, so you pay for what the AI actually does.
Autopilot has its own identity, memory and workspace inside the company’s systems and delivers finished work. Conceptually, that is closer to a labor cost than a software cost.
Agent 365, Microsoft’s admin console that gives each AI agent an identity and permissions like an employee, had nearly 40 million agents registered by July, against more than 30 million paid Copilot seats.
Code runs on the same technology as GitHub Copilot, Microsoft’s coding assistant, which the post tells developers to keep using. So it is the same engine aimed at non-developers, already inside the company’s files, which a standalone agent has to be let into.
On seat licensing, Copilot has a feature called Auto that chooses for each request, weighing accuracy, speed and cost.
On meter licensing, the company buys credits, every task uses them, and you choose the model yourself. Astra and Fable, the top models from OpenAI and Anthropic, are available there.
Under a flat fee a heavy user costs Microsoft money. Under a meter the customer pays for every task, which is probably why employees get a visible credit balance.
Theoretically, Microsoft wins either way in the model race. If one lab pulls ahead, customers pay Microsoft to use it. If models become interchangeable, Microsoft still owns the data, the agent’s identity and where it runs.
AI companies are still figuring out what they are actually selling. Is it software, to be priced per person? Or is it work, to be priced per task? Microsoft’s answer is both, for now.