What is Microsoft 365 Copilot?

Microsoft 365 Copilot is Microsoft's generative-AI assistant embedded across the Microsoft 365 apps. It can draft documents, summarise emails and meetings, query Excel, generate slides, and answer questions grounded in your own tenant's content.

Where it shows up

• Word: drafting documents from prompts, rewriting passages, summarising long files.
• Excel: explaining formulas, analysing tables, generating charts and summaries.
• PowerPoint: building decks from a Word doc or a prompt, restyling slides, generating speaker notes.
• Outlook: drafting and summarising emails, surfacing what changed in a long thread.
• Teams: live meeting recap, action-item extraction, chat catch-up.
• Microsoft 365 Copilot Chat (the standalone app): a chat surface that can answer questions against your tenant's files, emails, and chats, or against the open web.
• Copilot in SharePoint, OneNote, Loop, Whiteboard, Planner and more, with capabilities expanding regularly.

How it works

Copilot uses large language models (Microsoft's own and OpenAI's), but its key trick is grounding: it pulls relevant content from your tenant via the Microsoft Graph — your files, emails, chats, calendars, and people — and feeds that into the model alongside your prompt. Responses cite the source items, and Copilot respects existing permissions: it can't show you content you can't already access.

Licensing and prerequisites

Microsoft 365 Copilot is a paid add-on on top of a qualifying Microsoft 365 subscription (Business Standard / Premium or Enterprise E3 / E5). It's licensed per user, billed monthly or annually.

Before rolling it out, organisations typically want to clean up oversharing — Copilot will surface anything a user has access to, so loose SharePoint and Teams permissions become visible quickly. Microsoft Purview's data security and SharePoint Advanced Management tools exist largely to help with this.

Copilot vs Copilot Chat (free)

There's also a free Microsoft 365 Copilot Chat tier that answers from the open web only, without tenant grounding. The paid Microsoft 365 Copilot adds the in-app experiences and the grounding-on-your-data capability — that's where the real value is.