Summary
Microsoft announced Agent 365 at Ignite 2025 (their annual technology conference), calling it the “control plane for AI agents.” Two weeks later, organisations want to know what it will cost. So far, Microsoft hasn’t published any pricing.
What we have instead is a mix of official documentation, a hastily withdrawn admin centre announcement, and thoughtful analysis from licensing experts who’ve been watching Microsoft’s AI strategy unfold. This article separates what we know from what we’re guessing.
What Agent 365 Actually Is
Status: Fact · Microsoft Learn
Agent 365 is not an agent builder. You don’t use it to create AI agents; you use Microsoft’s agent-building tools (Copilot Studio, Microsoft Foundry) for that. Agent 365 is the governance layer: it registers agents, gives them identities, controls what they can access, and lets you see what they’re doing.
It extends Entra ID (Microsoft’s identity service) to cover agents. Just as human employees get identities, security policies, and access controls, agents now get the same treatment within the same system. Microsoft calls these “Entra Agent IDs” and the agents themselves “agentic users.”
The core idea is straightforward: every agent in your organisation gets registered, given credentials, and controlled centrally. You can see which agents exist, what they’re allowed to access, and what they’re actually doing. If an agent misbehaves or someone deploys one without approval, you can shut it down.
You pay per agent. Microsoft calls this the “A365 licence.” One agent, one licence.
Whether you built your agent with Copilot Studio, Microsoft Foundry, or an open-source framework, Agent 365 is where you register and manage it.
The Licence Exists
Status: Fact · Microsoft Learn
There is definitely an “A365 licence” and you need it to run agents under Agent 365. Microsoft Learn states plainly: “You need an Agent 365 license assigned by the tenant admins in the Microsoft 365 admin center.” (Your “tenant” is your organisation’s Microsoft 365 environment.)
The licence is assigned per agent, not per user who interacts with the agent. Microsoft’s documentation is explicit: licences are “for assignment to agent instances only.” If you deploy five agents that serve your entire workforce, you need five licences, not thousands.
Organisations in Microsoft’s early access programme (called “Frontier”) receive 25 A365 licences automatically. Twenty-five agents is a modest starting point, which suggests Microsoft expects organisations to scale gradually.
The Slip-Up
Status: Fact (withdrawn) · Preserved via The Register
Here’s where it gets interesting. In early November 2025, Microsoft published admin centre announcement MC1183300 describing how Agent 365 licensing would work. Days later, they withdrew it.
The withdrawn announcement contained some useful details that haven’t appeared in current documentation:
“Admins assign the required A365 license at the time of approval. No additional Microsoft 365 or Teams license is required.”
“No additional Microsoft 365 or Teams license is required” is the key detail. It suggests agents don’t need their own M365 licences. That would make sense: assigning premium human licences (like E5 at $57/user/month) to a fleet of bots would be absurd. But because Microsoft pulled the announcement, we can’t treat it as current policy.
Why did they withdraw it? We don’t know. It could be a commercial change, a legal review, or simply premature publication. The current official documentation avoids the question entirely.
The Current Ambiguity
Status: Fact (but confusing) · Microsoft Learn
Microsoft Learn now says: “Agentic users require appropriate Microsoft 365 licenses to access these services. Common licenses include Microsoft 365 E5, Teams Enterprise, and Microsoft 365 Copilot.”
This is confusing because:
“Agentic users” means agents, not humans
The licences listed (E5, Teams Enterprise, M365 Copilot) are designed for human users and priced between $30 and $57/user/month
Assigning these licences to 50 agent instances would be economically unreasonable
So what does Microsoft actually mean? Three interpretations are possible:
Each agent needs its own M365 licence (unlikely; too expensive)
The tenant needs M365 licences generally for agents to access services (plausible)
A365 bundles M365 service access for agents (also plausible; aligns with the withdrawn announcement)
Nobody outside Microsoft knows which interpretation is correct. The documentation contradicts itself.
What Licensing Experts Think
Status: Expert opinion · Jukka Niiranen
Jukka Niiranen, an independent licensing specialist who focuses on Power Platform and Dynamics 365, has written extensively about Agent 365. His view is that A365 likely bundles whatever M365 access agents need:
“The tools needed for participating in information work inside Microsoft 365 will most likely come included with the A365 license.”
He also interprets the withdrawn MC1183300 as the intended commercial model: A365 alone is sufficient for agents, without additional M365 licences.
On pricing, Jukka notes that Microsoft hasn’t disclosed A365 licence costs. He speculates, based on Satya Nadella’s comments about subscriptions including “thinking time,” that A365 might include some allowance for agent activity with overage billing. But this is inference, not fact.
Status: Expert opinion · Rich Gibbons
Rich Gibbons points out that the phrase “required A365 license” (rather than “the A365 license”) might hint at multiple licence types for different agent roles. This is speculative, but not unreasonable given Microsoft’s fondness for creating multiple licence tiers.
The Two-Layer Billing Model
Status: Our inference (strongly supported)
The available documentation points to a two-layer billing model:
Layer 1: A365 Licence (governance) |
One licence per agent instance. Covers registration, identity, and governance. Pricing unknown. |
Layer 2: Copilot Credits (consumption) |
Copilot Credits are Microsoft’s billing unit for AI agent activity. Every time an agent does something, it costs credits. You pay either as you go or by buying credits in advance through the Pre-Purchase Plan (P3). |
The rates vary by what the agent does. When an agent wakes up on its own to handle something (an “autonomous trigger”), that costs 25 credits. Generating a response costs 2 credits. Taking an action (like sending an email or updating a record) costs 5 credits.
This mirrors how Copilot Studio already works: you need a licence to build agents, but you also pay for what those agents do. A365 adds the governance layer on top.
Whether there’s a third layer (separate M365 licences for agents) remains unclear. The withdrawn announcement said no; the current documentation is ambiguous.
What the Licence Probably Covers
Status: Our inference
Based on feature descriptions in Microsoft Learn, the A365 licence likely includes:
Registering and tracking your agents
Identity and credentials for each agent
Governance and compliance features
Dashboards showing what agents are doing
What it almost certainly does not include:
Copilot Credits for agent activity (billed separately)
Microsoft’s security and compliance tools (Purview for compliance, Defender for threat protection) — these require their own licensing
Azure OpenAI capacity (the underlying AI compute that powers agents) — billed separately
Microsoft Learn explicitly states that Purview features may require pay-as-you-go billing even when A365 is in place. A365 can pass data to Microsoft’s security products, but those products require their own licensing.
What We Genuinely Don’t Know
Status: Unknown
These questions remain unanswered:
A365 licence pricing: Microsoft has not disclosed any pricing. Not in documentation, not in announcements, not in the Frontier preview.
Seeded capacity: Does the A365 licence include any Copilot Credits, or is it governance-only with all compute billed separately?
M365 bundling: Does A365 bundle M365 service access for agents, or do you need separate M365 licences?
Third-party agents: How do agents from other software vendors integrate with A365 billing? Who pays for the A365 licence: the customer or the vendor?
General availability timeline: Only Frontier preview is available. Microsoft says features “may change over time.” No release date announced.
What It Might Cost
Status: Speculation
Microsoft hasn’t disclosed pricing. But we can make educated guesses based on how they price similar products.
If A365 follows the pattern of other governance tools, expect a per-agent-per-month subscription, possibly tiered by agent capability. Jukka Niiranen suggests it might include some seeded Copilot Credits, similar to how some Microsoft 365 bundles include a limited allowance of other AI services.
On top of the A365 licence, you’ll pay for what agents do. Copilot Credits cost $0.01 each if you pay as you go, or roughly $0.008 each if you buy in bulk. Autonomous triggers add up quickly: 25 credits per trigger means a busy agent could consume hundreds of dollars in credits monthly.
For a concrete example: an HR helpdesk agent that handles 200 queries per day would consume roughly 200 × 32 credits = 6,400 credits daily (assuming one autonomous trigger, one answer, and one action per query). That’s about 192,000 credits per month, or roughly $1,900 in credit costs alone, plus whatever the A365 licence costs.
The Copilot Credits portion you can estimate if you know how often the agent will be triggered. The A365 licence portion is a complete unknown until Microsoft announces pricing.
Frontier Preview Access
Status: Fact · Microsoft Adoption
Agent 365 is currently available through the Frontier preview programme. Requirements:
At least one M365 Copilot licence in the tenant
Agent templates are rolling out through December 2025.
This is preview, not production. Microsoft explicitly warns that features may change before full release.
Bottom Line
For now, organisations evaluating Agent 365 should plan for two cost components: a per-agent subscription (price TBA) plus consumption billing via Copilot Credits. The governance layer is where Microsoft wants to monetise the “digital labour” concept. The consumption layer is where Azure gets its cut.
When Microsoft announces pricing, we’ll update this article. Until then, treat any cost projections as speculation.
Need Help?
We don’t know what Agent 365 will cost yet. But if you’re planning Microsoft AI budgets that span both licensing and Azure consumption, or negotiating a Microsoft agreement that needs to account for emerging AI costs, get in touch.
We don’t sell Microsoft licences or cloud services, so our advice is unbiased. We help you understand what you’re paying for before you sign.
This article will be updated when Microsoft announces A365 pricing or general availability.