Hi and welcome back to the podcast. This is the audio of my monthly Teams update. Everything you need to know in under 15 minutes. If you want to see the full video and slides, you can catch over on LinkedIn or X or on Empowering Cloud along with the full PowerPoint deck and all the links. Hope you find it useful.

On with the show. 

Tom Arbuthnot: Hi, and welcome to the Microsoft 365 AI Workplace Update for May 2026. Many thanks to Logitech, who are the community benefactor this month. Really appreciate all their support to the community. We have a lot to talk about. There's new Microsoft 365 E7 GA. We have new AI models. We've got our first voice agents in Copilot Studio and Dynamics 365 Contact Center, and we've got Teams Multiline and Teams Voice Agent answering your Teams phone calls as well.

Lots to talk about. Let's get stuck in. If you haven't been on to Empowering Cloud recently, we did a blog on Express Install, a really hot topic at the moment, and Logi took us through their portfolio of Express Install options.

Also talking a lot about cloud video interop, direct guest join, and cross-platform meetings via SIP. We're soon going to get cross-platforms via SIP on Microsoft Teams Rooms on Android, and Marius took us through those different options and how to compare and contrast them, different capabilities. Also, the Microsoft 365 Roadmap team and Message Center team have new MCPs, and there's a blog explaining those as well.

On the podcast, we've had a deep dive into Cowork, the, the hottest new thing in Microsoft 365 Copilot with Bas. Really excited about that. Also, Brett broke down the differences between Frontier, Work IQ and Cowork and Agent 365, and we had a really good conversation about frontline worker opportunities as well with Spectralink.

I've also I was also at Microsoft 365 conference last month, and here's all the...

. i was also at Microsoft 365 Community Conference last month. Got to catch up with a lot of friends there. Really good sessions. And if you wanna catch up on some of the news, the videos are on LinkedIn or on our YouTube channel.

Right, into the Microsoft 365 and Copilot news.

The biggest news in May is that Microsoft have made the Microsoft 365 E7 license generally available. This is their new top-tier SKU, although it doesn't include everything. There's still a lot of add-ons if you want to add them on . But what it does include is Microsoft 365 E5 and the Microsoft 365 Copilot license, Agent 365, and the Entra suite.

So Microsoft are positioning this as their frontier firm SKU. So this is what you need if you want to be all in on AI. Agent 365 really is the cornerstone of this. It's listing at ninety-nine dollars per user a month. You can also get it the without Teams SKU for eighty-nine dollars, and it saves you about ten dollars if you were going to buy those component parts separately.

Agent 365 is that it's a platform that can help you manage agents, uh, either agent-to-agent or human-to-agent use, observability, government, and security. And the idea here is that we're all going to be using lots of agents.

They're going to potentially sprawl, so you want to understand what's going on, you want to audit them, you want to control them. And, uh, in the podcast where Brett explained it really well, the idea is, is that if you are a user who is engaging with agents, then you would need the Agent 365 license to get that level of visibility and understanding.

So it's not just about the people who make the agents, it's about the people using the agents as well. And along with that Agent 365 generally availability news, we also got news that the Agent Registry, which was previously separate in Microsoft 365 Admin Center, is converging into Agent 365.

So if you've been using Agent Registry, then that will become part of the Agent 365 solution

so if you've been using agent...

So if you've already been using the agent registry, be sure to check out that change coming where it brings it into Agent 365.

That is an edit point.

We have some new frontier models in Microsoft 365 Copilot this month. So Claude Opus 4.7 is now available,

And it's available initially in Copilot Cowork, which we'll talk about, Copilot Studio and rolling out to Copilot in Excel.

We also have the latest and greatest models from OpenAI, ChatGPT-5.5-Thinking and ChatGPT Image 2.0 are also into Copilot. Images 2.0 really stepping up to kind of get close to...

Images 2.0 really stepping up to match what Google have been doing on the Nano Banana front. Really excited to have that in the Copilot family.

And we're seeing these models, particularly Anthropic models, being put to good use in the Microsoft 365 suite. So the agentic capabilities in Word, Excel, PowerPoint are getting these latest frontier models. If you do have Anthropic enabled, then you will have the full agentic experience, and the latest one is Microsoft Outlook.

This is a really big deal because this is the agent capability to manage email, book appointments, are the one that a lot of people have been waiting for. So in the agentic model, rather than just being on a side panel and not interacting, they can interact with the Excel sheet, with the Word document, with the PowerPoint, or in this case, with Outlook.

And it's not just Microsoft who are pushing forward on that. Anthropic are, as well as being a partner of Microsoft's, are also releasing their own plugins for Excel, Word, PowerPoint and Outlook. These just became generally available.

You've got Microsoft partnering with OpenAI and partnering with Anthropic to bring the models natively. But you also have the frontier houses bui-building their own plugins for the Office suite, and OpenAI just announced their plugin for Excel as well. So exciting and competitive space.

Cut.

We now have Copilot Cowork in the Frontier program. So this is similar to Anthropic's Cowork, actually built in partnership with Anthropic. But whereas Anthropic's Cowork works in their app on the desktop, so it needs the desktop running, it's accessing local files. The Microsoft 365 Copilot Cowork is running in a container in the cloud and respects all the controls around the Microsoft 365 ecosystem, Purview sensitivity labels.

It also has access to Graph, so it can actually do things. And this is the big change. It can send emails, you can schedule tasks, you can move appointments, you can arrange your calendar for the week, you can do deep research, and it's all using the latest Anthropic models. So you can see we have either Sonnet or Claude Opus, and we've just had some new features dropped for Cowork, so some big changes in Cowork.

It now has the latest Opus4-7 model. It also has mobile support. So whereas in Anthropic, when you're using the mobile, you're dispatching a task to your physical desktop. In the Microsoft model, obviously, you're dispatching your tasks to a containerized compute in the cloud, which is really nice. Agent 365 integration, as we would expect.

Also, it now has skill support and plugin support. So this is a big unlock for Cowork being able to integrate with third-party systems through plugins and skills. Uh, further integration to OneDrive, that's where it drops your files if it's, it's processed specific files for you, and search task history as well.

This is a really exciting capability. It really is our version of Anthropic Cowork, but in the cloud, in the Microsoft ecosystem. I've been using it quite a lot. It's definitely resource-constrained at the moment. You can feel it topping out, particularly in the afternoon in Europe when the US and the rest of the world gets online.

Uh, but really excited for this. No date yet for when it will come out of Frontier. But if you are in Frontier doing-- you do have the Anthropic models enabled, then do check it out.

Skills really are a hot topic in the AI industry at the moment. All the major platforms have adopted the concept of skills, which essentially are instructional markdown files so you can repeat a task with more accuracy and more reliability, and you can share that way of doing things with other people as well.

Cowork has skills, and now SharePoint has skills as well. So you can build skills for SharePoint, and they can interact with your, your files and the rest of your SharePoint estate. So this is currently, again, in the Frontier program.

So nice to see this standard approach to skills coming across the wider ecosystem and of course across the Microsoft 365 estate.

Work IQ is Microsoft's semantic layer of all the enterprise's knowledge that AI can easily access. So Copilot can access it, and it will include things like your emails, your OneDrive, your SharePoint, all your chats, your transcripts. So this is how the AI has that enterprise knowledge all secure and controlled.

Obviously, you can only get to what you're allowed to get to. An exciting development is Work IQ will now have an API. So it already has an MCP. The API is now in preview, and this allows other agents to access the Work IQ information. So it could be agent to agent, could be with the model context protocol, and also coming soon is a rest capability.

It does require that you have the Work IQ license as a user to access the MCP server, but it'll be interesting to see how the API is supported. And there'll be scenarios where even other agentic platforms can potentially use this API to get information out of Work IQ. Again, interesting to see how that will play out from a, a licensing and control point of view.

But if you are building and developing agents, take a look at Work IQ API and MCP. Really interesting developments there.

With all the developments and reasoning models in AI getting more and more powerful and things like Cowork, which potentially will chew up a lot of tokens, it feels more and more like in the M365 space, we're going to go to some kind of hybrid consumption model, and enterprises are not sure about how they pay for consumption.

Generally, they like fixed costs or controlled costs, and we're seeing a new thing in Microsoft 365, which is using prepaid capacity credits as the sole billing method for using Copilot. So at the moment, this is things like agentic scenarios where you're paying on a consumption basis. You can buy fixed packs of credits so you know what your exposure is, run those down, and then buy more credits without having a consumption account.

Microsoft's voice...

Microsoft's AI voice agent story is coming to Copilot Studio So this is exciting progression in the voice space. We've heard about the, uh, Copilot... We heard about Copilot call delegation now in the Frontier program, so that's the voice agents in Teams. This is the voice agent technology being available in Copilot Studio, uh, launching in Dynamics 365 Contact Center, so this is exactly what you would expect.

Voice agents that can interact with customers directly on the phone or via VoIP, real-time back and forth. A really exciting area for the contact center space and extensible in Copilot Studio as well. We'll be doing a whole session on what Microsoft are doing with voice agents soon, so look out for that.

We all know Microsoft 365 change is moving faster than ever, particularly with Frontier and Copilot, and to that end, Microsoft are modernizing the change management process. This is a topic really close to my heart. I follow the roadmap and the Message Center really carefully. We've been pulling all the roadmap and Message Center for years with the ChangePilot product as well, and Microsoft are really improving things here.

So they are moving to an audience-based release model. So rather than having, at the moment we've got targeted release, we've got preview, and we've got standard release. Microsoft are moving to a new model of Frontier, and you can select a selection of users, audience based. So these are my Frontier users that are opt-in.

They get early access pre-GA. Things might be changing, things might be moving very fast. So for example, the new Copilot features in Teams or Copilot Cowork would be Frontier features. Then you've got standard release. That is the GA features for most users. Still moving reasonably fast these days, but those are GA fully supported standard release.

And if you've got users who are more sensitive or you need a bit more time, there is deferred release, and the deferred users will get the features thirty days after they hit standard release. So a new model where you can pick on an audience based who gets what. This will initially be for Copilot and AI features coming into this new model.

Slowly, this will move over the other product sets as well to the point where this is the release methodology for all the new features. Also, Microsoft are changing the way they write the Message Center messages, so they are tidying up the communications.

They're gonna have the same format each time, which is really nice to see. And the most exciting change, they've added MCP servers for the roadmap and for Message Center and Service Health. So the roadmap is a public MCP. We've got a blog on Empowering Cloud about how to use that, and I'm currently working on a blog for the enterprise MCP, which is really the Graph MCP, and that will allow you to get to your Message Center and your Service Health.

On to the Microsoft Teams and AI-powered workplace features.

Copilot call delegation. This is the first time we are seeing voice AI agents in Teams Phone. Really exciting to see. This is essentially a voice agent answering on your behalf and call filtering. So it will ask if the call is urgent, and if it's urgent, it will try and reach you and connect the call.

Otherwise, it can book a meeting or it can take a message. And this is kind of like the call filtering you see on the iPhone where it can answer, ask who's calling, ask what it's about. Uh, really nice to see this coming into Teams Phone, and this is using the same voice AI agent technology that we're seeing in Copilot Studio in, in Dynamics 365 Contact Center as well.

Multi-line in Microsoft Teams phone is now generally available. We've been talking about this for a while. This is the ability to have multiple phone lines for a given user or a given IP phone in Teams. Those phone numbers can be a mix of phone numbers. They can be operator connect, they can be direct routing, they can be calling plan, and there's support for up to eleven phone numbers, so one primary, one private, and nine alternate numbers, and you can make outgoing calls and incoming calls on these numbers. It's Teams desktop and web client, and the mobile clients are coming soon.

A new capability in Interpreter. So previously, Teams Interpreter agent would, as you started talking, dip the volume of your voice and for the remote party, start playing an interpretation in the local language. Uh, there's some cultural scenarios where that was deemed, you know, not appropriate. So in this scenario, it's consecutive in the sense of the person speaks, they fully speak, then they stop, then Interpreter picks up and does the interpretation.

And this works much better in group scenarios where there's a language being spoken in one location and a language being spoken in another, so we can have the interpretation play for the entire group as opposed to just a personal feed of that interpretation.

This currently supports up to ten languages and is in the public preview of Teams at the moment.

New in developer preview is targeted messages for agents. So this gives agents the ability to., send messages one-to-one or send messages to a group. So rather than just being in a group chat, the agents can be much more engaging with individuals or groups of individuals.

Microsoft Teams Rooms and devices news.

Digital signage on Teams Rooms on Android is now GA, similar to what we have on Windows. Does require Teams Rooms Pro.

For the first time, we see Avaya's, uh, J-Series phone. And also for the first time, we see Avaya's J-Series phones being supported on Teams SIP Gateway and also a whole range of, uh... And also a whole range of Axis, uh...

And also a whole range of Axis door entry and speakers as well. So really expanding the, really expanding the devices on the Teams SIP Gateway.

Lastly, onto events.

We have a lot coming up. We've got an Insider Live with the Dynamics 36... We've got a lot coming up. We've got Insider Live on Dynamics 365 Contact Center. Very looking forward to that. We have our regular UC User Group London. That's at BSI's office.

We have our Copilot in-person user group in London, Teams Fireside Chat with the Teams Phone team, regular devices, uh, MTD AMA as well, and also the Microsoft Change Call and Copilot Fireside Chat. Lots going on there.

I talked about the big changes coming to Microsoft 365 Change Management as well. We're lucky to have the Microsoft 365 Change team for a webinar with Michael, an MVP, talking through those changes.

Thanks again to Logitech for being our community benefactor this month. Really appreciate all their support to the community.

Let me know your thoughts on any of the updates, and hope to see you at one of the events soon