Microsoft launches pay-as-you-go AI powered productivity

Google also bundles AI features into Workspace for small increase in subscription fee

Microsoft is launching a pay-as-you-go plan for corporate customers that bundles several of the company’s existing AI-powered productivity features for Microsoft 365.

The new plan is called Copilot Chat and is powered by OpenAI’s GPT-4o AI model. The package will allow users to ask business-related questions, summarize key points in files, draft documents or create an AI-generated image. There is also a collaboration tool available in the form of Copilot Pages.

“Copilot Chat … adds pay-as-you-go [services] to our existing free chat experience for Microsoft 365 commercial customers,” Microsoft said in a blog post published Wednesday. “Copilot Chat is a powerful new on-ramp for everyone in [an] organization to build the AI habit.”

Building the AI habit (and incremental revenue from AI curious organisations with relatively straightforward requirements) appears to be the primary objective of this product launch, with particular emphasis on (and this is a word you’re going to see and hear a lot this year) ’agentic’ features.

Using the Microsoft 365 Copilot app, Copilot Chat users can launch “agents” to automate basic tasks. Example use cases provided by Microsoft include customer service representatives interrogating a CRM for details before a customer meeting, or better access to data in Sharepoint for field service agents.

Agents will be priced on a “metered basis,” according to Microsoft.

This metered or pay-as-you-go Copilot Chat is distinct from the Microsoft 365 Copilot which includes prebuilt agents and AI-powered capabilities for Microsoft Teams and the full suite of Office productivity apps. Personalisation options are limited and no analytics tool. In November, Microsoft bundled its Copilot Pro AI features with the standard Microsoft 365 subscription.

In an internal memo this week, Microsoft CEO Satya Nadella said that the company’s focus in 2025 will be “[AI] model-forward applications” that “reshape all application categories.”

“We have a lot of work to do and a tremendous opportunity ahead,” Nadella wrote. “The good news is that we have been working at this for more than two years and have learned a lot in terms of the systems, app platform, and tools required for the AI era.”

Meanwhile at Google..

Google announced yesterday that all AI features in Gmail, Docs, Sheets, and Meet are now available to Workspace Business Standard customers and that it is increasing the cost of the Standard plan from $12 to $14 per month.

Previously customers wanting access to AI features such as email summaries, automated notetaking, and chats with Gemini had to fork out an additional $20 per user per month for the Gemini for Workplace plan on top of the $12 for the Workspace Business Standard plan they already paid.

The new pricing takes effect for new customers immediately, and existing customers will see changes starting March 17, 2025. Small business customers are exempt from these pricing changes for now.