Copilot, Copilot Chat or Microsoft 365 Copilot: which is which, and what does each cost?

Three products share the Copilot name. Copilot is the free consumer chat. Microsoft 365 Copilot Chat comes at no extra cost with eligible business plans and answers from the web. Microsoft 365 Copilot is the paid per-user add-on that works inside Word, Excel, Outlook and Teams, using your own files and emails.

Most of the confusion, and most of the wasted spend, comes from mixing the three up, and the mixing is understandable: Microsoft has reused one brand across a consumer app, an included business assistant and a premium add-on, and renamed pieces along the way. If you have asked is Copilot free and received three contradictory answers, all three were probably correct about different products. The result shows up on invoices as often as in conversations: businesses paying for the add-on while only using the included tier, and businesses avoiding a free tier because they assume it is the paid one. Here they are, one at a time.

The consumer Copilot is the free chat anyone can open in a browser or app with a personal account. It is a capable general assistant and it has no relationship with your business: no access to your files, and, more importantly, none of your business's controls over what staff paste into it. For work involving anything sensitive, treat it the way you would treat any public chatbot, which is a policy question we cover separately.

Microsoft 365 Copilot Chat is the tier most businesses do not realise they already have: included at no additional cost with eligible Microsoft 365 business plans, for staff signed in with their work account. It answers from the web rather than from your files, with business-grade protections around what is typed into it, which makes it the sanctioned free option, the right default for the everyday drafting and questions staff are currently taking to public tools. For a team currently pasting work questions into whatever chatbot is open at home, moving them to the signed-in Chat is a governance win that costs nothing and takes an afternoon.

Microsoft 365 Copilot, the full product, is the paid per-user monthly add-on on top of an eligible base plan such as Business Standard or Business Premium. This is the one that lives inside Word, Excel, PowerPoint, Outlook and Teams and is grounded in your own tenant: your documents, emails, meetings and chats. It answers questions like summarise everything about this client from my email and files, which the other two tiers cannot, and it respects your existing file permissions, which is exactly why permissions need to be right before rollout. The distinction is worth a concrete example: ask Chat about depreciation rules and it searches the web; ask the full Copilot and it can also find what your accountant emailed you about them in March.

On cost, the structure is the thing to hold onto, because the numbers move: an eligible base Microsoft 365 plan per user, plus the Copilot add-on per user for the people who get the full product, with Copilot Chat costing nothing extra for everyone else. Microsoft's Australian pricing page is the authority for this quarter's figures and bundles, and any provider quoting you should be working from it, dated.

The practical shape for a small business follows directly. Everyone gets Copilot Chat, because it is included and it redirects staff away from ungoverned public tools. The full add-on is bought per role, not per company, for the people whose weeks are dominated by documents, email and meetings, ideally as a measured pilot first. Buying the full product for a whole company on day one is how licences end up decorating people who never open them. Review the split quarterly; roles change faster than licence assignments do.

Two caveats to keep this page honest. The names and tiers will change again, so verify against Microsoft's current Australian pages before signing anything, and be suspicious of any article, including this one, that claims permanence. And none of the three products is a governance strategy: what staff may paste where, and what Copilot can reach through your permissions, are decisions to make before the licences arrive, not after. If you want help sorting tiers, permissions and rollout order, call 1800 456 567.