Microsoft is going hard with Copilot, whether be its implementation on Windows or in Microsoft 365. While it has a lot of use cases, when it comes to the overall features that it has to offer, you might have to think a lot before spending $30 a head per month.
However, AI is expensive, particularly for small businesses. The Wall Street Journal recently interviewed the early adopters of Copilot, who questioned if the “AI” is really worth the money, as businesses need to spend $30 for every user. At the Morgan Stanley TMT Conference, Microsoft tried to explain why it’s worth investing in Copilot.
While speaking with Keith Weiss, who runs the U.S. Software Research franchise at Morgan Stanley, Microsoft’s Jared Spataro explained that Copilot in Office products like Excel is still in the early stages, and it’s getting there (to a point where it makes more sense).
“Copilot in Excel is still in early stages, and it’s learning every day. Users have very high expectations, and they are expecting Copilot to become their financial analyst, but it’s very far from the stage we’re currently at as we’re still learning the command surface of Excel and PowerPoint,” noted Jared Spataro, who is responsible for Copilot and Microsoft 365 apps at Microsoft.
Spataro further explained that the Copilot system comprises several key components, including data orchestration, large language models (LLMs), and specialized skills. Each of these elements is improving rapidly and in ways that aren’t always linear, meaning you can expect significant upgrades over the coming months or years.
Microsoft promises to make Copilot even better, making interactions with it increasingly efficient and, in Spataro’s words, “magical.”
During their conversion, Jared Spataro shared as many as three key scenarios where Microsoft can justify the price point of Copilot quite well:
- Chat Experience Across Microsoft 365: the AI can work across all apps, be it your emails, calendar, documents, or transcripts, and act as a chatbot. That’s something human employees may not be able to do efficiently.
- Teams: The Copilot in Teams can summarize the meetings and follow-ups and give additional information, which can be used to highlight the important points and actions.
- Outlook: In Outlook, Copilot can help employees understand the long email threads, and draft complex emails. This is particularly useful when handling a high volume of emails
“We are able to justify the price point quite well when we move over into those scenarios that I listed as our top three scenarios,” he added.
Microsoft acknowledged that $30 is a significant price point, especially compared to other Microsoft offerings like Microsoft 365 E3 at $36 and E5 at $57. And because of this price tag, companies are still questioning whether Copilot is the right fit for them and if they should invest in it.
Copilot will be a moneymaker, as Microsoft continues to work with customers
Microsoft is currently working with customers to help them understand whether they need Copilot or not. They are doing this using factors like whether Copilot is helping them save time or if it is generating enough value that they should consider investing in it.
Jared further added that they are very optimistic about the future of Copilot, but at the same time, users need to be a bit realistic and temper their expectations. Like any innovation, Copilot will undergo a typical deployment and evaluation cycle.
And then, companies will decide whether they should allocate a budget for it or not.
Over the long term, Copilot will be a great moneymaker for Microsoft. The company is hopeful and optimistic:
“I would say my job here is to temper your expectations. Over the long term, we think this will be a great moneymaker for us. But don’t think that it’s breaking free of the normal deployment cycle, the normal evaluation cycle, the normal budget cycle associated with IT,” Jared Spataro added.
So, it will be interesting to see how Microsoft makes companies’ minds switch from whether they should get Copilot or not to yes; Copilot is one of the most important requirements for our company.
