Microsoft is quietly laying the groundwork to charge enterprises for AI agents the same way it charges for human employees: one licence per digital worker, per month. According to reporting by The Register and analysis from industry research firm Directions on Microsoft, the company is considering a new subscription tier informally called E7 that would bundle Microsoft 365 Copilot and its newly introduced Agent 365 platform into a single, premium package aimed squarely at enterprises running autonomous AI workforces.
The proposed price point, cited by multiple outlets including Business Insider, is around $99 per user per month. That figure sits well above the current Microsoft 365 E5 flagship tier, which costs $57 per month and is itself set to rise to $60 from 1 July 2026. Add a full Microsoft 365 Copilot licence at $30 per month on top, and the arithmetic quietly explains where the $99 headline number originates.
The Register reports that Microsoft acknowledged questions about E7 but declined to comment further. The company has not officially confirmed the tier exists.
What E7 Would Actually Include
The rationale for a dedicated tier is more substantive than it might first appear. As AI agents proliferate inside corporate environments, they require the same digital infrastructure as human staff: email addresses, Teams accounts, directory entries via Microsoft Entra ID, and policy controls under Microsoft Purview. These capabilities are currently tied to user-based licences, creating an awkward mismatch when the "user" is an autonomous software process rather than a person.
Agent 365, which is currently in preview as part of Microsoft's "Frontier" test programme, is not a standalone service but a set of features including identity management using Entra, compliance controls using Purview, and security infrastructure using Defender XDR. It gives each AI agent its own Microsoft Entra Agent ID for identity, lifecycle, and access management, and allows agents to be monitored and managed from the Microsoft 365 admin centre.
If confirmed, E7 would be the first new Microsoft 365 licensing tier for enterprises since the company launched E5 back in 2015. Rather than a simple per-user subscription fee, Microsoft is reportedly considering some kind of hybrid user- and consumption-based pricing model for the new tier. That distinction matters enormously for corporate budgeting: a flat per-seat cost is predictable, while consumption-based charges tied to how much an agent actually does can balloon unpredictably.
The Strategic Play
Mary Jo Foley, editor-in-chief at Directions on Microsoft, framed the broader intent plainly. Microsoft officials, she reports, "have said to expect agents, as they proliferate in the enterprise, to need to be licensed in ways similar to human employees." Lane Shelton, the firm's Director of Advisory Services, put the commercial logic in starker terms. "This isn't about a new licensing tier," Shelton said. "It's about Microsoft positioning itself as the enterprise AI control plane for the emerging digital worker."
From Microsoft's perspective, the commercial necessity is clear. Licensing experts have observed that Microsoft's revenue focus has shifted to average revenue per user, "which is now hitting its ceiling" as one analyst put it. "You can only scale so far. Earth's population grows slower than Microsoft's revenue targets. What we have been predicting is the move to ARPA, average revenue per agent, which can scale exponentially."
The Counterargument: Cost and Complexity
The case for E7 is not one-sided. From a purchaser's perspective, bundling Copilot and Agent 365 into a single SKU may actually reduce the administrative overhead of managing E5 alongside multiple add-ons. The licensing tier may appeal to customers wanting to avoid the administration overhead of E5 plus a selection of separately purchased add-ons. Simplicity has genuine value for IT departments already stretched thin.
But critics raise legitimate concerns. Licensing uncertainty is already stagnating adoption of Microsoft's AI products because enterprise buyers have no reliable way to forecast costs, with one licensing specialist noting that the complexity of Copilot licensing is "not understood by anybody on the buyer side." A consumption-based element on top of a high base price risks compounding that problem. Agents that run continuously, monitoring systems or generating daily reports, can quickly consume compute credits and produce unexpected bills if usage is not capped or throttled.
There is also a governance dimension that Australian businesses, with their obligations under the Privacy Act and emerging AI accountability frameworks, should take seriously. Licensing specialists have asked publicly what happens if agents "go rogue", potentially sending sensitive data to the wrong people, providing incorrect information, or behaving in ways that are offensive or harmful, and how such behaviour is to be prevented, monitored, and acted upon. The answer, under the E7 model, would presumably sit inside Agent 365's governance tooling, but the details remain to be seen.
What Australian Organisations Should Do Now
The final scope of E7, its precise price points, the launch timetable, and how Microsoft will carve features between existing E3 and E5 tiers and any new E7 SKU all remain unverified. The $99 figure and the exact inclusion list should be treated as rumour-level reporting until Microsoft makes a formal announcement.
That uncertainty is not a reason to wait passively. Australian enterprises currently running or piloting AI agent deployments inside Microsoft 365 should be mapping their renewal dates relative to the confirmed July 2026 price increase, and modelling what agent-based licensing could mean for their IT budgets. The direction Microsoft is heading is not seriously in doubt, even if the precise commercial terms are. Digital workers are coming for a spot on the payroll. The question is how much Microsoft will charge to put them there.