Microsoft Combines AI Tools Into Single App to Compete With Anthropic

Microsoft is consolidating its business AI tools into a single application as the software giant seeks to gain momentum in the enterprise AI market, where Anthropic has been increasing its traction.

The updated Copilot app now integrates coding capabilities with a tool for building agents that can automate tasks and communicate via email and messaging platforms. Microsoft hopes this move will entice more of its Office 365 customers to pay for advanced AI features.

Despite Microsoft's dominant position in business software, its flagship product for AI-driven work optimization has not achieved expected success. Fewer than 7% of the more than 450 million commercial Office 365 seats globally include a license for the AI add-on.

Microsoft's stock performance this year has lagged behind many megacap peers, with the stock up only 3% as of Thursday's close. The company is shifting away from a monthly subscription model to a usage-based pricing structure for the new app, similar to how other AI products are priced.