New Copilot: Microsoft's Surprising Code and Smart Agents

New Copilot is the name Microsoft gave on Friday 25 September 2026 to the biggest rebuild of its AI assistant since launch. The app now has three parts. Home combines chat, the Cowork agent and full versions of Word, Excel and PowerPoint. Code lets non-developers build apps, dashboards and automations by describing them in plain English. Autopilot, previously called Scout, is an always-on agent with its own identity inside a company’s Microsoft 365 tenant.

The pricing is changing too. The familiar per-user Copilot licence stays for everyday work, but Cowork, Code, Autopilot and the most advanced models will be billed by usage in Copilot Credits. For enterprise customers those usage-based services stay switched off until an administrator creates a spending policy. Microsoft shares rose about 3% in early trading, according to Reuters.

This article sets out what is in the new Copilot, when each part arrives, how the two-part pricing works, what controls administrators get, and why Microsoft is doing this now. It ends with a practical checklist for IT teams and the open questions that Microsoft has not yet answered.

Table of contents

What Microsoft Announced in the New Copilot
Code Brings Code Generation to the New Copilot
Autopilot: The Always-On Agent in the New Copilot
How the New Copilot Is Priced
FinOps Controls Admins Get in the New Copilot
Why Microsoft Is Rebuilding Copilot Now
What the New Copilot Means for IT Teams
Risks and Open Questions in the New Copilot
Frequently Asked Questions About the New Copilot
References

What Microsoft Announced in the New Copilot

Jared Spataro, Microsoft’s chief marketing officer for AI at work, introduced the new Copilot on the Official Microsoft Blog. “Just as Office defined work for the PC era, the new Copilot is built to define it for the AI era,” he wrote. The pitch is that one app now covers asking, delegating, building and automating work, instead of a separate product for each.

Home: chat, Cowork and Office in the new Copilot

Home is the new starting point. Chat handles quick questions, lookups and first drafts. Cowork is for work you delegate: you define a task, such as an RFP response or a financial close package, and it runs end to end. Microsoft says that soon you will not need to pick a mode, because Copilot will route each request to Chat, Cowork or Code itself.

Office in Copilot

Home also brings the full versions of Word, Excel and PowerPoint inside the new Copilot app. Ask for a launch brief, a budget model or a deck and Copilot creates a real, editable file that the whole team can work on live. Edits stay in sync between Copilot and the Office apps. Microsoft also highlighted Skills, which add specialist expertise to the apps, such as financial skills in Excel and legal skills in Word.

Code and Autopilot

Code and Autopilot are the two genuinely new capabilities, and they get their own sections below. Code turns a description into working software that runs inside the company tenant. Autopilot is a persistent agent that keeps working when the user is not there. Together they are why Reuters described the new Copilot as adding code generation and agentic AI tools to Copilot.

Capability	What it does	Status announced on 25 September	How it is billed
Chat	Quick answers, lookups, first drafts	Available now	User subscription licence
Cowork	Runs delegated multi-step tasks end to end	Generally available since June	Usage-based, Copilot Credits
Office in Copilot	Full Word, Excel and PowerPoint inside the app	Part of Home, rolling out through Frontier	User subscription licence
Code	Builds apps, dashboards, widgets and automations	Frontier at end of September, broad availability in coming weeks	Usage-based, Copilot Credits
Autopilot	Always-on agent with its own identity	Private preview at end of September	Usage-based, Copilot Credits
Copilot Managed Runtime	Hosts code inside the Microsoft 365 tenant	Public preview now	Covered by cost management

Code Brings Code Generation to the New Copilot

Code is the surprise addition. Microsoft argues that the unit of knowledge work has always been the file, meaning the document, spreadsheet or deck, and that Code adds a fourth: small, purpose-built software that anyone can create. “Learning to build them is becoming as basic a skill as writing a memo or modeling a budget,” Spataro wrote.

What Code builds

You describe an app, tracker, dashboard, automation or workflow in natural language, and Copilot chooses an approach and builds it. The outputs range from persistent desktop widgets for quick reference, to interactive dashboards for exploring data, to cloud-hosted internal apps that can be shared with a team. Microsoft says Code is powered by the same underlying technology as GitHub Copilot and runs in a sandboxed environment.

Who gets Code in the new Copilot, and when

Code rolls out to the Frontier early-access programme at the end of September, with broad availability “in the coming weeks”. It will be in preview for Microsoft 365 Premium and Pro subscribers later this year, so consumers will see it too. Professional developers are not the target. Microsoft says they “continue to use GitHub Copilot” for their daily work, now with more connections into the new Copilot platform.

Copilot Managed Runtime hosts new Copilot apps

The harder problem with letting everyone build software is running it safely afterwards. Microsoft’s answer is Copilot Managed Runtime, now in public preview. It hosts code inside a company’s Microsoft 365 boundary, uses Microsoft Entra identity for access, applies organisational policies to connectors, data and endpoints, and keeps Git-backed version control. Apps appear in a central inventory in the Microsoft 365 admin center, whether they were built in Code, in Cowork, in Copilot Studio or in a third-party tool.

Third-party builders are included

The runtime ships with an SDK and command-line tools that let developers scaffold projects, define data connections, generate typed TypeScript services and deploy versions. David Blyth, Microsoft’s vice president for managed apps and agents, gave a concrete example. With the SDK, “an app made with Lovable can now run inside your Microsoft tenant, the same way everything else does: same sign-in, same policies, same app inventory.” That makes the new Copilot a hosting platform as well as an assistant.

How Code compares with other coding tools

The competitive target is clear. Tom’s Hardware described Code as Microsoft’s answer to OpenAI’s Codex and Anthropic’s Claude Code. CNBC reported that Jacob Andreou, Microsoft’s executive vice president for Copilot, acknowledged that adding coding to the new Copilot was an instance of Microsoft playing catch-up. The difference Microsoft is betting on is the tenant: apps built in Code inherit the company’s identity, data policies and admin controls by default. Our guide to AI coding assistants compared covers the wider field.

Autopilot: The Always-On Agent in the New Copilot

Autopilot is Scout under a new name. Microsoft introduced Scout at its Build conference in June as the first of “a new category of agents called Autopilots”, in the words of Omar Shahine, the corporate vice president who leads it. At that stage it was a desktop app in limited preview. The version announced on Friday is cloud-hosted, so it keeps working while the user sleeps.

Give it a name, a role and a goal

Microsoft describes Autopilot as a “digital teammate”. You give it a name, a role and a goal, and it watches channels, follows up on threads, runs recurring work and picks a project back up days later without waiting for a prompt. Spataro’s example was a supplier review: Autopilot builds the schedule and plan, then handles preparation, meetings and follow-ups, including chasing stakeholders for updates.

Its own identity, memory and computer

The enterprise design is what separates Autopilot from consumer agents. It lives in the tenant “with its own identity, memory, computer and workspace”, and it shows up in Teams, Outlook, chats and documents, where staff can @mention it like a colleague. At Build, Microsoft said Scout ran under its own governed Microsoft Entra identity rather than a shared service account, worked within Purview sensitivity labels and data loss prevention, and could require human approval for sensitive actions.

Why governance is the selling point

“I think it’s been very hard for many organizations to bring agents into the enterprise because of security, compliance and governance concerns,” Annie Pearl, corporate vice president of Copilot Product, told Reuters. Agent identity is the right place to start, a point we made in our analysis of why AI agents need their own identity before they need a gateway. The new Copilot puts that principle into a mainstream product for the first time.

When Autopilot reaches the new Copilot

Autopilot expands to private preview at the end of September. Microsoft has not published Autopilot pricing beyond saying that it runs on usage-based billing, so organisations piloting it should expect credit consumption rather than a flat fee. Companies already exploring digital workers can compare the model with our approach to AI employees and autonomous agents.

How the New Copilot Is Priced

The pricing of the new Copilot may matter more to finance teams than any single feature. Microsoft is splitting Copilot into “everyday AI” on a fixed licence and “advanced AI” on a meter. The company compares it to a plug-in hybrid car: the licence is the battery that covers most daily driving, and usage-based billing is the fuel tank for longer trips.

Everyday AI on the user subscription licence

The user subscription licence, or USL, is priced per user per month. For the commercial Microsoft 365 Copilot that is $30, according to CNBC. It covers Copilot in Chat and across Word, Excel, PowerPoint, Outlook and Teams, plus model selection. An Auto mode weighs accuracy, speed and cost on each request and routes it to a suitable model. Microsoft says GPT-5.6 and Sonnet 5 are included, and Opus 5 will be included with limits.

Fair use limits on the licence

The licence has always had fair use terms, and Microsoft says it is setting limits so that “the vast majority of people never reach a limit”. Heavy users get a warning first, then a choice: switch to Auto at no extra cost or move to credits. Microsoft argues that metering everyday work is “the wrong deal” because companies then ration access, and says it wants everyone to use AI.

Advanced AI on usage-based billing

Cowork, Code, Autopilot, new advanced experiences in apps such as SharePoint, and frontier models such as Fable and Astra all run on usage-based billing, or UBB, paid in Copilot Credits. The licence is still required to use them. Credits can be bought as prepaid capacity packs of 25,000 credits a month, through discounted annual pre-purchase plans, or pay-as-you-go against an Azure subscription, according to Microsoft Learn.

Question	User subscription licence (USL)	Usage-based billing (UBB)
What it covers	Chat plus Copilot in Word, Excel, PowerPoint, Outlook and Teams	Cowork, Code, Autopilot, long-running tasks, frontier models
Price basis	Fixed per user per month ($30 for Microsoft 365 Copilot)	Copilot Credits consumed per task
Models	Auto, GPT-5.6, Sonnet 5, Opus 5 with limits	Fable, Astra and full model choice
Limits	Fair use limits, warning before any change	Budgets and caps set by the administrator
Default for enterprise tenants	On with the licence	Off until a spending policy exists
How to buy	Licence per user	Capacity packs, pre-purchase plan or pay-as-you-go

What a new Copilot task costs is not fixed

Microsoft Learn explains that the number of credits a task consumes varies with the models used, the amount of context retrieved, the runtime needed and the tools called. That is the honest answer to “what will the new Copilot cost us?”, and it is why the controls in the next section matter. Microsoft also published an internal cost comparison against Claude and ChatGPT set-ups for modelled everyday and advanced users. It is the company’s own analysis, based on list prices and 40 test prompts, and Microsoft itself says actual results will vary.

FinOps Controls Admins Get in the New Copilot

Microsoft calls its cost tooling FinOps for AI, and most of it lives in cost management in Agent 365, inside the Microsoft 365 admin center. Microsoft says this cost management is included with the Microsoft cloud subscription. The new Copilot expands what it covers: it already handled Cowork and the Work IQ APIs, now adds Code and Copilot Managed Runtime, and will cover agents built in Copilot Studio from October.

Spending policies come first in the new Copilot

For enterprise customers, UBB services stay off until an administrator creates a spending policy, and nothing is billed before that. Policies set budgets at tenant and group level, including per-user caps within groups, with alerts at chosen thresholds. Administrators decide what happens when someone nears a limit: a warning, a way to request more, or no prompt at all.

Mapping spend to departments

Spend can be assigned to Azure subscriptions or resource groups, so AI costs appear in the same place as the rest of a department’s cloud spending. Reports break usage down by user, group, workload, policy and payment method. That matters for organisations that already recharge IT costs internally, because the new Copilot usage can follow the same accounting route.

Control	What it does	Status
Spending policies	Budgets and caps at tenant, group and user level with alerts	Available
Departmental billing	Assigns usage to Azure subscriptions or resource groups	Available
Model family access	Limits which model families each group can use, and what Auto can pick	Rolling out in Cowork first
Consumption insights	Shows which Cowork scenarios use credits and what they produced	New, in Insights and cost management
Graph API for policies	Manages spending policies from existing FinOps and BI tools	New
Credit request routing	Sends user requests for more credits to existing approval flows	New
End-user visibility	Staff see credit use, balance and history inside Copilot	New
Copilot Studio agents	Brings Studio agents under the same cost management	Planned for October

Visibility for the people spending the credits

End users can see their own credit usage, remaining balance and history directly in Copilot. In Cowork, typing /cost shows the approximate credits a task has used so far, according to Microsoft Learn. Putting the meter in front of the person running the task is probably the most effective control on the list, because it changes behaviour before the invoice arrives.

Why Microsoft Is Rebuilding Copilot Now

Microsoft dominates business software through Office, but its flagship work AI product has not taken off in the same way. Microsoft said in July that Microsoft 365 Copilot had passed 30 million paid seats, up from 20 million in April. Against the more than 450 million commercial Microsoft 365 seats it reported in January, that is about 7%, as GeekWire calculated, and CNBC put it at fewer than 7%.

Microsoft 365 Copilot paid seats compared with the commercial Microsoft 365 base (millions)

Commercial Microsoft 365 paid seats (January 2026) 450 million

Microsoft 365 Copilot paid seats (July 2026) 30 million, about 6.7%

Microsoft 365 Copilot paid seats (April 2026) 20 million, about 4.4%

From many Copilots to one new Copilot app

The new Copilot is the end point of a reorganisation that began in March, when Satya Nadella put Jacob Andreou in charge of Copilot across consumer and commercial products. Nadella told investors on the 29 July earnings call that a Copilot “super app” would ship this quarter. In August Microsoft merged its consumer and business apps into one app called Microsoft Copilot, with a new web address, and retired features such as Copilot Podcasts and Group Chat, GeekWire reported.

Competition from Anthropic, OpenAI and Meta

CNBC framed the new Copilot as Microsoft trying to regain momentum in enterprise AI, where Anthropic has been gaining ground. The market has been consolidating around products from OpenAI and Anthropic that bundle chat, coding and agents. Microsoft still relies on those labs: the new Copilot uses OpenAI and Anthropic models, and CNBC reported that the Home tab offers no Microsoft model at all. “We’re building Copilot as a new OS for work that spans every model, every form factor, and every task,” Nadella wrote on X.

What early customers say

CNBC spoke to David McLaren, enterprise data and AI leader at the consultancy GHD, which has given Copilot to 12,000 employees. About 200 of them are experimenting with Cowork. McLaren said he was excited about the new Copilot “because it makes GitHub-like capability simpler for more people to use”. That ratio is a fair picture of where most organisations are: broad access to chat, and a small group trying the delegated and agentic tools.

GHD’s Copilot rollout: licensed staff compared with Cowork experimenters

Employees with Microsoft Copilot 12,000

Employees experimenting with Copilot Cowork about 200, roughly 1.7%

What the New Copilot Means for IT Teams

For IT departments, the new Copilot is mostly a governance project. Three things change at once: staff can create software, agents can act on their behalf with their own identities, and costs become variable. Each needs an owner before the features reach users. Microsoft’s own rollout sequence helps, because nothing usage-based switches on until an administrator acts.

Decide on Frontier before the new Copilot arrives

Home and Code arrive first through the Frontier programme, which a Microsoft 365 Copilot customer must opt into. That gives organisations a natural pilot boundary. Pick a small group, set a modest spending policy, and measure what they build and what it costs before anyone widens access. An experienced managed IT services partner can run the pilot and the admin configuration alongside business-as-usual support.

Area	Decision to make before rollout	Where it is set
Frontier enrolment	Which users get Home, Code and Autopilot previews	Microsoft 365 admin center
Spending policy	Monthly budget, per-user caps and alert thresholds	Cost management in Agent 365
Model access	Which model families each group may use	Cost management in Agent 365
App hosting	Who may publish apps and to which data connectors	Copilot Managed Runtime and Apps inventory
Agent identity	What each Autopilot may read, send and approve	Entra ID and Purview policies
Plugins	Which Microsoft, partner and custom plugins are approved	Plugin registry
Recall exclusions	Re-apply screenshot exclusions to the renamed Copilot app	Windows policy

Treat user-built apps as real software

Code will produce working applications quickly, and some will end up holding sensitive data. The managed runtime gives central inventory and policy, but someone still has to review what gets published, who owns each app and when it is retired. The same discipline applies as for any AI-assisted code, which we covered in our guide to using AI coding assistants safely.

Fold agents into existing controls

Autopilot’s own Entra identity is an advantage only if identity governance is already in good shape. Review conditional access, data loss prevention labels and approval rules before an agent starts reading channels and sending messages. Link this work to your existing IT governance framework, rather than writing a separate rulebook for AI.

Risks and Open Questions in the New Copilot

Microsoft has answered many questions about the new Copilot, but not all of them. The gaps are mostly about cost and control over time, and they are worth raising with Microsoft or a reseller before signing a larger commitment.

Credit rates for Code and Autopilot

Microsoft has explained how usage-based billing works but has not published a price list showing how many credits a typical Code build or a day of Autopilot activity consumes. Until it does, budgets will be estimates. Start with small caps, watch the consumption insights and adjust.

Sprawl and shadow apps

Lowering the barrier to building software also lowers the barrier to building unmaintained software. The central apps inventory helps, but only if someone reviews it. Organisations should set an ownership rule, such as every published app needing a named owner and a review date.

Dependence on outside model labs

The new Copilot depends on models from OpenAI and Anthropic, and Microsoft says more labs and open-weight models are coming. That gives choice, but it also means model behaviour, pricing and availability depend partly on companies Microsoft does not control. The dispute this week between Anthropic and the US Department of War shows that such dependencies can shift for reasons unrelated to the technology.

Security of always-on agents

An agent that watches channels and acts without prompting widens the attack surface. Prompt injection through a shared document or email is the obvious risk. Microsoft’s controls, including agent identity, Purview labels and human approval steps, are the right shape, but cybersecurity teams should test them against their own threat model before Autopilot leaves private preview. Our look at Microsoft’s AI privacy rules for schools showed how much detail can hide in Microsoft’s policy wording.

Date	What arrives
Now	Copilot Managed Runtime public preview, Fabric IQ in Chat and Cowork, plugin registry rollout begins
End of September	Code in Frontier, Autopilot private preview, @Copilot in Teams private preview
Coming weeks	Home and Code across Frontier, broad availability of Code, plugin registry across surfaces
October	Today in private preview, Copilot Studio agents in cost management
Next month	Dynamics 365 and Power Platform grounding in public preview
17-20 November	Microsoft Ignite in San Francisco and online
Later this year	Code preview for Microsoft 365 Premium and Pro subscribers

Frequently Asked Questions About the New Copilot

What is the new Copilot?

It is Microsoft’s redesigned Copilot app, announced on 25 September 2026, with three parts: Home (Chat, Cowork and Office), Code for building apps, and Autopilot, an always-on agent formerly called Scout.

Is Code in the new Copilot the same as GitHub Copilot?

No. Code uses the same underlying technology as GitHub Copilot but is aimed at non-developers building apps, dashboards and automations. Developers keep using GitHub Copilot.

How much does the new Copilot cost?

Everyday use stays on the per-user licence, which is $30 per user per month for Microsoft 365 Copilot. Cowork, Code, Autopilot and frontier models are billed in Copilot Credits on top of the licence.

Will usage-based charges start automatically?

Not for enterprise customers. Microsoft says usage-based services stay off until an administrator creates a spending policy, and nothing is billed before then.

When can we try Autopilot in the new Copilot?

Autopilot enters private preview at the end of September 2026. Home and Code roll out first through Microsoft’s Frontier early-access programme.

Which AI models does the new Copilot use?

Models from OpenAI and Anthropic, including GPT-5.6, Sonnet 5, Opus 5, Fable and Astra, with Auto choosing a model for each request. Microsoft says models from more labs are coming.