Microsoft switches Copilot Business to usage-based billing model

Microsoft is overhauling its billing structure for Microsoft 365 Copilot Business licenses, shifting to a usage-based model starting November 2. This change applies to eligible services and is designed to simplify onboarding for small to midsize businesses, according to a report by CRN.

The new licensing approach combines a standard per-user subscription with additional Copilot Credits for more complex tasks. Routine AI functions will be covered under the base license, while advanced, agentic tasks will incur separate charges. Microsoft claims this model reduces billing friction for solution providers, allowing them to focus on adoption and value demonstration.

Partners are expected to help clients adjust to the new system. Microsoft also touts better value compared to competitors like Anthropic and OpenAI, as more everyday AI tasks are included in the base license. The company is introducing cost management tools, including FinOps for AI, to help forecast and control AI spending, creating new opportunities for service providers.