Microsoft Tells Copilot to Earn Its Keep, Merges Apps Into One by August

Microsoft is telling its flagship AI product to prove it's worth the money. Jacob Andreou, the executive vice president who has led Copilot since March 2026, sent a memo to the more than 11,000-person team with a clear message: the product has to earn its right to exist by delivering measurable results, not intelligence for its own sake.

The consolidation project, known internally as 'Delivering one Copilot', is meant to fix a problem customers have complained about for months: Microsoft's AI tools scattered across separate apps and interfaces. Instead of switching between chat, a coding assistant and business tools separately, users are set to get a single hub with a toggle between personal and work accounts, while still being able to use individual tools on their own if they prefer.

What's Cut, What Stays

Andreou described the process as cutting what didn't work. The list of scrapped features includes Copilot Podcasts, which automatically generated audio summaries of meetings and documents, and Copilot Labs, a channel for testing experimental features. Both were cut due to low user engagement.

In place of the cut features comes AutoPilot, a new category of always-on AI agents that run in the background without needing to be manually triggered for every task. The agents are meant to monitor email, calendars and organizational data through Microsoft Graph and take action on their own. The first example of such an agent is expected to be Microsoft Scout. Access to AutoPilot, however, requires a separate paid subscription on top of the base Copilot tiers, since analysts estimate agentic workflows consume 5 to 30 times more compute than a simple chatbot conversation.

The Adoption Math

The numbers behind the decision are uncomfortable for Microsoft. Among Microsoft 365's 450 million commercial users, fewer than 4.5 percent pay for Copilot, and of those who do pay, only 20 to 30 percent use it even once a week. That means the largest distribution base in business software worldwide still isn't translating into paying, engaged AI users.

Analyst Brent Thill pointed to this gap directly, praising Microsoft's reach while criticizing the product's own reception.

They have the best distribution in software and technology - Brent Thill, analyst

The same comment included a much harsher assessment of Copilot itself, described as a product that simply doesn't work the way it should, a sign that Microsoft's distribution advantage alone doesn't guarantee product success.

Origins of the Plan

Plans to merge Copilot's tools into a single app were first reported by Fortune in May 2026, which covered the project led by Andreou before the memo's details became public. At the time, the reporting focused mainly on merging GitHub Copilot, the chat feature, the Copilot Cowork tool and an agentic feature that was internally named at the time. July reporting, based partly on findings from The Information, filled in the scope of the feature cuts and the hard numbers behind the decision, as well as the name of the new paid agent tier, AutoPilot.

For Polish companies using Microsoft 365, this means an interface change is coming this fall, along with likely new pricing for agentic features that today are either included in existing Copilot licenses or not available at all. It's worth checking now which currently used features, such as Copilot Podcasts or Labs, are on the list to be discontinued, to avoid surprises when the August rollout arrives.

The restructuring covers one of Microsoft's largest product teams since the original Copilot launched, and is meant to show investors and customers that the company can turn its distribution scale into real AI revenue, at a time when competitors like OpenAI with ChatGPT and Google with Gemini are competing more aggressively in both the consumer and enterprise segments.