Microsoft pitches introduction of 365 E7 as a channel opportunity

Microsoft has described the introduction of 365 E7, which become effective from today, as an opportunity for its channel partners.

The firm outlined plans back in March to move to a value-based licensing model, with the topic a regular subject of conversation between executives and analysts on the vendor’s third-quarter earnings call earlier this week.

Microsoft’s 365 E7 has been designed to cover 365, Copilot, Entra ID suite and Agent 365 on a monthly per-set fee and a consumption model for those that use additional services, including premium artificial intelligence (AI) options and extended Copilot usage.

Speaking with analysts, Microsoft’s CFO Amy Hood said that the changing models reflected shifting customer dynamics with the acceleration of AI adoption: “As we go through using a model that’s been historically thought of as a per-seat business, suddenly – if you think about getting work done and being more productive – it’s thinking about being a seat or a worker plus an agent.

“When I think about that model, I start to think about it as a license business plus a consumption business, applying far more broadly than I think people have thought about. It starts to mean that bookings will look a little different. It’ll still have that per-seat license logic, but it’ll also have a meter, just like you see in Azure, and it may not all flow through bookings in the same way.”

Nicole Dezen, chief partner officer and corporate vice-president of global channel partner sales at Microsoft, used a blog post last month to emphasise the positives surrounding the 365 E7 launch: “The opportunity for partners is end-to-end, and this is where the partner’s strategy really matters. Shifting from transaction-first to outcome-first, partners who iterate quickly, establish clear guardrails and build an operating rhythm for adoption move customers from interest to impact.

“Over time, every organisation will employ people who can direct and govern agents as part of daily work. Partners can make that capability real through packaged offers, change management and managed operations. Publishing those packaged offers in the Microsoft Marketplace adds a scalable route to market, improving discoverability and enabling a more repeatable buy-and-deploy motion as customers expand agent usage,” she added.

Dezen said that its channel was already supporting customers with AI and driving greater levels of adoption: “Partners are creating impact right now in three areas. First, agentic workflows that remove operational friction and orchestrate end-to-end work across operations, finance, supply chain and services.

“Second, customer zero maturity. Partners who adopt Copilot and agents internally build credibility and move faster because they have meaningful, real-world experiences that they translate into their go-to-market plans.

“Third, security as the foundation. There is no AI at scale without secure identity, protected data and strong governance.”

Microsoft is encouraging its channel to get involved with its AI cloud programme and gain specialisations to underline their abilities to deliver the levels of support around AI that customers are looking for.