Author: rich_gibbons

Microsoft Licensing, products, Cloud, and more!
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Microsoft Agent 365 – what we know so far


It’s been rumoured for a while that Microsoft would release a new product/license for AI Agents called Agent 365 and we have the first public acknowledgement of this from Redmond.

Microsoft 365 Message MC1183300 is titled “Microsoft Teams and Microsoft 365 Copilot: Discover and create agentic users from Teams and M365 Agent Store” and gives us some initial information.

Starting in mid-November 2025, we will get “AI-powered Agentic Users” that will have “full organisation identities”. Users will be able to request agent templates but, at least for now, admins will control the creation and licensing.

What are AI Agents?

Microsoft differentiate them from bots and say:

Agentic Users are provisioned as full-fledged user objects with their own:

  • · identity in the organization’s directory (via Entra ID or Azure AD)
  • · email addresses
  • · Teams accounts
  • · presence in the org chart

They can participate in meetings, send and receive emails and chats, access and act upon enterprise data, and learn from interactions to improve over time. They have the ability to “proactively reason and act without explicit instructions”.

How are AI Agents licensed?

Per Agent licensing

Continue reading “Microsoft Agent 365 – what we know so far”
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Microsoft Financial Results: Q1 FY26


Satya Nadella now refers to Microsoft “building a planet-scale cloud and AI factory” which, with the recent agreement with Open AI, including $250 billion of Azure services (these don’t impact the Q1 results), and Copilot, shows they’re not changing direction any time soon.

Is Microsoft Copilot successful?

Lots of talk in the earnings call about Copilot growth and success with 90% of the Fortune 500 using M365 Copilot and various organisations purchasing 15,000+ seats in Q1 and PWC purchasing 155,000 seats. One should always be carefully sceptical of numbers like this from software publishers – what exactly is “using” and how many people within an org are “using” the software for example?

Copilot functionality is being added into almost every facet of Microsoft’s product portfolio, making it ubiquitous whether users really want it or not!

What are Microsoft’s Financial Results for Q1 FY26?

Revenue = $77.7 billion, an 18% increase

Net Income = $27.7 billion, a 12% increase

Microsoft Cloud = $49.1 billion, a 26% increase

What are Microsoft spending?

  • Capital Expenditure (CAPEX) was up 74% in Q1 FY26 “to support customer demand for…cloud and AI offerings.” Approximately half of that spend was on “short-lived assets” such as GPUs and CPUs for Azure and AI growth.
  • Long-lived assets spend was up 71%, driven by lease commencements for “large datacenter sites”.

You can see here the huge amount of money that Microsoft are spending on building datacentres, primarily to handle AI growth.

Productivity & Business Processes

  • Revenue = $33 billion, a 17% increase
  • Microsoft 365 Commercial Revenue = 17% increase
  • Dynamics 365 revenue = 18% increase

Operating Expenses increased 6% driven by investments in “compute capacity and AI talent”.

The M365 growth was driven by E5 and Copilot. 

Intelligent Cloud

  • Revenue = $30.9 billion, a 28% increase
  • Azure = 40% increase

Operating Expenses increased 4% driven by investments in “compute capacity and AI talent”. 

Earnings Call highlights

  • Microsoft plan to increase their total AI capacity by 80% through FY26 and double their datacentre footprint by 2028. They plan to launch the “world’s most powerful AI datacentre” in 2026 which will hit 2 gigawatts itself.
  • Fabric revenue increased 60% and now has 28,000 paying customers.
  • Cosmos DB revenue increased 50%.
  • Microsoft Sentinel has 40,000 customers.
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Microsoft Copilot Credit Pre-Purchase Plan


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Microsoft are moving more and more towards consumption billing for their products – right across the portfolio. This makes it much more difficult for customer organisations to predict and forecast usage, which will generally lead to over-commitment and uncertainty. It also, however, means that Microsoft’s revenues and product sales are less predictable, which isn’t what they want.

Copilot is a huge focus for Microsoft as is moving towards Agentic AI – which is done via Copilot Studio. Much of this is billed via Credits (formerly Messages) and Microsoft have now introduced the “Copilot Credit Pre-Purchase Plan” (aka “P3“) to help with some of the unpredictability (on both sides). You purchase an amount of “Copilot Credit Commit Units (CCCU)” and pay upfront for the year.

Each CCCU is worth $1 and is equivalent to 100 credits. There are 9 tiers:

These credits expire annually which is a better than the Microsoft Copilot Studio Copilot Credit capacity packs, which expire monthly.

Understanding when to buy this, which level to buy, and whether they’re being used effectively will be a great example of collaboration between ITAM & FinOps teams.

See more here – https://techcommunity.microsoft.com/blog/finopsblog/unlock-savings-with-copilot-credit-pre-purchase-plan/4464511

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Microsoft Product Terms: November 2025


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Some Azure AI terms added around “the use of First-Party Consumption services and the use of Web Knowledge Sources while using Grounding with Bing services”.

Microsoft 365 E3 added as the prerequisite for Microsoft eDiscovery Graph API Standard

Terms added following the recent updates around Teams:

“This Notice applies to customers in the European Economic Area (EEA) who purchase through Microsoft’s commercial licensing programs with a billing account that is in the EEA.

Such customers have the right to purchase (no Teams) Suites (and those in multi-year agreements may switch to (no Teams) Suites at their next annual order) at a price below the price of the corresponding Covered Suites. Customers are also eligible to receive the same percentage discount (whether negotiated or offered as a promotion and whether implemented as a price reduction or as a rebate) on the (no Teams) Suites that is offered on the corresponding Covered Suites. These (no Teams) Suites may be used with competitors to Teams if the customer purchases a competing solution.

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Microsoft Product Terms: October 2025


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More name changes to keep us all busy!


Rebranded Microsoft 365 E5 Security (and all relevant offers) to Microsoft Defender Suite
Rebranded Microsoft E5 Compliance (and all relevant offers) to Microsoft Purview Suite

M365 E5 Security = Microsoft Defender Suite
M365 E5 Compliance = Microsoft Purview Suite

M365 F5 Security = Microsoft Defender Suite FLW
M365 F5 Compliance = Microsoft Purview Suite FLW

There is also a “Defender + Purview Suite FLW” SKU

FLW = FrontLine Worker

As always, there’s going to be a period of time where the names differ between pages, sites, documents etc. so be prepared…especially for renewals.

2) Removed Microsoft Defender Threat Intelligence from Availability and Prerequisite Tables

3) Azure Firmware Analysis and Azure IoT Operations connectors added

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Microsoft Azure Storage Discovery


Microsoft have a new (currently in preview) service to give more visibility into your Azure Blob storage.

Azure Storage Discovery will:

  • Measure how much data is stored across all storage accounts
  • Identify regions experiencing the highest growth
  • Find opportunities to reduce costs by locating infrequently used data
  • Assess whether storage configurations align with security and compliance best practices
https://learn.microsoft.com/en-us/azure/storage-discovery/overview

Storage is often a source of hidden spend (and waste) in the cloud, so this may well be a useful weapon in your arsenal.

How is it priced?

There is a Free tier and also a paid-for Standard tier.

https://learn.microsoft.com/en-us/azure/storage-discovery/pricing

1 The backfill feature automatically adds historic data into a Storage Discovery workspace from before the workspace is created.
2 Every workspace retains insights for some time to allow for historical analysis.

The total cost will be comprised of:

  • Pricing plan
  • Workspace configuration
  • Number of storage resources & data objects analysed

Note that a storage resource can be included in multiple workspaces and will be charged in each one.

How much will all this cost? As the service is in Preview, and you’re able to use it for free, Microsoft haven’t released pricing details. These will become available on Azure.com before October 1, 2025, when billing kicks in.

To find out more about what it does and how it works, head here.

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Microsoft Product Terms: September 2025


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Visual Studio Subscriptions have been added to MCA

Windows 10 ESU added to CSP

Microsoft Defender & Microsoft Purview Suites have now been made available to Business Premium users

That last point is very interesting as this brings a world of new security features to smaller organisations – which will have multiple impacts:

1) directly increase the ARPU (Average Revenue Per User) of SMB customers as they buy new add-ons
2) increase the chances of SMB customers adopting Copilot – as these new products address many of the security/data challenges…
2b) which will further increase the ARPU of SMB customers

Microsoft have long been calling out the strength of SMB driving M365 sales so this is a logical next step.

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Microsoft remove Enterprise Agreement discounts on Online Services


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BIG Microsoft news!

Are you a Microsoft EA customer with Online Services at Level B, C, or D pricing?

From November 1st, 2025:

“Microsoft will expand the set of products that have a single consistent price across Price Levels A-D to include all online services” on EA and MPSA agreements.”

The new pricing will be the same as on the Microsoft site once the waterfall discounts are removed.

This will take effect from your next renewal, or when you buy Online Services not on your CPS, post November 1st.

On-premises software pricing isn’t changing.

This is going to cause a lot of Microsoft bills to increase significantly – be prepared!

See the announcement here – https://www.microsoft.com/en-us/licensing/news/online-services-pricing-consistency-update

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Microsoft Extended Security Updates for Exchange & Skype


Exchange Server 2016 & 2019 and Skype for Business Server 2016 & 2019 go out of support in October 2025 (4 months at the time of writing).

The new Subscription editions have been announced as Generally Available by Microsoft (although not yet added to the Product Terms) but not all organisations are ready to make the move. To help with that, from August 1st, 2025, customers can contact their Microsoft account teams to purchase a 6-month Extended Security Update (ESU).

What to know

  • Any Critical/Important Security Updates released after the end of support will be privately provided to ESU customers.
  • Microsoft are not committing to release any updates during the ESU period.
  • The ESU will run for 6 months until April 14th, 2026 and – in Microsoft’s somewhat snarky words – “This period will not be extended past April 2026 (you do not need to ask).”

See Exchange details here – https://techcommunity.microsoft.com/blog/exchange/announcing-exchange-2016–2019-extended-security-update-program/4433495

See Skype details here – https://techcommunity.microsoft.com/blog/skype_for_business_blog/announcing-skype-for-business-2015–2019-extended-security-update-program/4433493

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ITAM & FinOps Tools: A crowdsourced list


I get a lot of questions about ITAM, SaaS, & FinOps tools – what is available, what do they do, which are the best etc.

The ITAM market has quite a few tools, there are several SaaS tools, and the FinOps tool market is huge…unnecessarily so some may say. This presents (at least) 2 problems:

  • Potential customers are overwhelmed and don’t know where to start
  • Genuinely innovative tools can be lost in a sea of marketing and promotion

In an attempt to help bring some clarity, I’ve started a crowd-sourced tool list here:

https://airtable.com/appEKdAtvVzFxTc0w/shrkDzHsUBHoEVK21

that currently contains 147 records…this has increase by 14% in the last 2 weeks!

The initial aim is to have a centrally available list of all the tools with some high level categorisation i.e. “SAM”, “FinOps”, “AWS only” etc. From there, I hope to add more info to help people dig deeper. Let me know what would be helpful for you!

If you think I’ve missed any – please add them here:

https://airtable.com/appEKdAtvVzFxTc0w/pagE5AfnBAh50K6ZC/form

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