Microsoft 365 Copilot is Microsoft's enterprise AI assistant, embedded directly inside Excel, Word, Outlook, Teams, PowerPoint, and OneNote. Unlike standalone AI tools, Copilot can read and reason over your actual work files — spreadsheets, emails, documents, meeting transcripts — without you copy-pasting data.
It launched for enterprise customers in early 2024 at $30 per user per month, then became available to SMBs in late 2025 with the launch of Copilot for Microsoft 365 Business (with promotional pricing through June 30, 2026).
What it actually does
In Excel, Copilot can analyze data via natural language ("show me revenue by region for Q3"), generate formulas you describe in plain English, build pivot tables, and as of April 2026, run inline via the new =COPILOT() function. In Outlook, it drafts and rewrites emails with context from your inbox. In Teams, it summarizes meetings and pulls action items. In Word, it drafts documents from prompts or outlines.
Where Copilot beats other AI tools
Copilot's real advantage is integration. It reads your SharePoint files, understands your Outlook context, knows who's in your Teams calls. ChatGPT or Claude can do similar tasks, but you have to manually paste the data each time. For an organization living in M365, Copilot eliminates that friction.
Where Copilot disappoints
Accuracy is uneven. Copilot will confidently produce wrong numbers, hallucinate facts about your data, and occasionally just refuse to complete tasks. Microsoft is explicit that the new =COPILOT() function should not be used for deterministic calculations or high-stakes decisions without manual verification.
The free or cheaper alternatives (ChatGPT Plus at $20/month, Claude Pro at $20/month) often produce better results for general reasoning and writing tasks — they just lack the M365 integration.
Who should use it
If your team lives in Excel and Outlook daily, Copilot earns its $30/month. If you're a solopreneur, freelancer, or work primarily outside the Microsoft ecosystem, you're better off with ChatGPT Pro or Claude Pro.