At Microsoft Ignite in San Francisco, what stood out to me is just how quickly Microsoft is adopting AI and, even more importantly, intelligent agents across its entire software stack—from Windows itself and the Microsoft 365 productivity suite to security and development products. Executives shared a vision of how this will transform businesses and talked about “frontier firms” that will adopt these technologies and completely change their organizations.Â
Microsoft made more than 70 product announcements at Ignite. I think the two most impactful are “work IQ,” an intelligence layer that will sit behind agents and Copilots; and Agent 365, a new platform for managing agents. However, it’s uncertain how quickly most enterprises will adopt any of these technologies at the scale Microsoft envisions. Its roadmap appears to be far ahead of where most customers are today.
“There’s been no wave of technology ever in the history of the world that has ever been adopted faster than AI, but on balance, the success rates of AI projects are not where we’d like them to be,” Judson Althoff Began, CEO of Microsoft’s commercial business, acknowledged in his keynote.
He listed four reasons for that—a lack of alignment between business and IT professionals; a lot of data quality issues; government requirements, including regulatory and compliance rules; and an overemphasis on experimentation or “random acts of innovation” rather than a focus on real business scenarios. Â
The difficulty in getting value from AI is something I’ve been hearing a lot of lately, and it’s instructive that Microsoft is seeing this as well. Still, Althoff said some companies are seeing real return on investment (ROI) from their AI efforts, and the rest of his keynote was devoted to what those “Frontier Firms” are doing or should be doing.Â
These firms are focused on enriching the employee experience, and are seeing the results in customer experience and on innovation. “The difference between successful projects and the ones that failed are this mindset shift from technology-focused efforts to business-led transformation empowered by AI and in that order,” he said.
According to Althoff, frontier firms “put AI in the flow of human ambition, [which] is contrary to somehow cutting and pasting your life into a chat window and expecting insights.” Instead, they infuse AI in the tools that people use every day. Frontier firms also let everybody create their own agents, which Microsoft terms “ubiquitous innovation.” And, they ensure observability and security in every layer of the data stack.
Copilot Changes and WorkIQ
Think your business can escape AI? Good luck. According to Ryan Roslansky, CEO of LinkedIn and EVP of Microsoft Office & Copilot, “the future of work and the future of AI are inseparable.”
Helping make that a reality is Work IQ, a new intelligence layer that helps Copilot and agents understand your role, your company, and your workflows. Work IQ combines data, memory, and inference to personalize responses and automate tasks.
Essentially, this seems to be taking the idea of the “Microsoft Graph”—everything you have access to in Microsoft tools, from email to Teams chat to SharePoint and One Drive—and adding AI for a persistent memory and personalized responses. It then uses inference to make connections in the data and memory to predict the next action or the next agent for the job.
Roslansky also talked about embedding intelligence in apps, which is essentially what Microsoft 365 Copilot has been trying to do all along, but now with more “agentic” capabilities. The next step is using Copilot and Work IQ to develop custom agents, and to combine Microsoft’s agents, third-party agents, and those developed by companies or users. “Copilot is the orchestrator, putting agents to work for you so they can execute any task or business process,” he said.
Microsoft talked about a number of new features coming to Copilot Chat, the company’s term for running Copilot next to individual applications, without requiring a separate Copilot license. This includes the ability for Copilot Chat in Outlook to see your full inbox, calendar, and meetings; helping you prepare for meetings, as well as “agent mode” in Word, Excel, and PowerPoint. Â
My understanding is this version of Copilot Chat will use the data in the document you are currently working with and files you reference plus web data, but will not have access to the Microsoft Graph or Work IQ for more advanced features. That will still require the separate Copilot license, and those tools will also be getting more capable.Â
All of this, like most of what Microsoft announced at Ignite, is either in preview now or will be in the next few months.
Building Agents Is for Everyone
Asha Sharma, president of Microsoft Core AI Product (Credit: Michael J. Miller)
Asha Sharma, president of Microsoft Core AI Product, focused on “ubiquitous innovation,” which in this context, primarily means ways to create agents. She started by discussing “the individual maker inside all of us,” talking about how everyone will be able to create an app in minutes by just describing what you want in M365 Copilot. “This is the beginning of something new,” she said. “Software evolving from being made for people to being made by people.”
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Copilot Studio, Microsoft’s low code agent developer, will now be able to use Work IQ, she said. Demos included using the App Builder function to make it easier to create full applications.
For professional developers, Sharma talked about changes to GitHub, including Agent HQ, a single place to pick agents from GitHub, OpenAI, Anthropic, Google, and others; as well as to Microsoft Foundry, the company’s AI development platform.
The biggest news here is that Anthropic models are now available in Foundry and GitHub. The company also introduced new intelligence layers, including Fabric IQ for its Fabric database service and Foundry IQ, which includes a new way of retrieval augmented generation (RAG) for agents. In addition, Microsoft announced a model router that automatically selects the best model based on accuracy, performance, cost, or balance. All this comes together in something called Agent Factory, where organizations can pick a metered plan for developing and rolling out agents, avoiding unplanned costs.
This includes several new security features, as well as access to a large number of enterprise systems and MCP (model context protocol) services. And there’s an emphasis on creating multi-agent systems.
Some other new features include computer use tools, so that an agent can use a separate computer or a website on your behalf, including Windows 365 for Agents, a special version of the company’s cloud-based PCs.
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It all sounds quite good, even if some of the demos were a bit hard to follow, and most of them dealt with a fictional company. I’m far from convinced that most users really want to create their own agents (at least not now), but making it easier for professionals who focus on other kinds of development certainly makes sense.
Charles Lamanna, president of Microsoft Business Apps & Agents (Credit: Michael J. Miller)
Charles Lamanna, president of Microsoft Business Apps & Agents, began his Ignite presentation by sharing that IDC predicts 1.3 billion agents will be deployed by 2028.
“One of the big challenges you all can be facing as part of this is how to track, manage, and govern all of these agents,” he said. To that end, Microsoft announced Agent 365, an agent control plane to monitor, manage, and secure all of the agents in your enterprise, including those created by Microsoft, your organization, and third parties.
This lives as part of the traditional M365 Admin Center, which IT departments already use to manage their users, their access, and their devices.
At the show, the company also introduced a series of other security tools, including Entra Agent ID, which gives each agent an ID you can manage just as you would an individual, controlling things such as access rights. And there are additional tools such as Purview Data Loss Prevention (DLP) for Microsoft 365 Copilot, and a data security posture management tool.
Early Days for AI Agents
Again, most of these tools are in preview, some only for organizations in the frontier program. These tools—and/or some of the many others I saw demonstrated at the conference from Microsoft and a lot of other firms—strike me as necessary building blocks before most organizations will be ready to roll out agents at scale. After all, security and governance are not optional, but rather crucial to any successful deployment.
Indeed, my big takeaway from the conference is that Microsoft showed off the foundational building blocks for creating, deploying, and managing agents, which is necessary, if not sufficient, for actually creating what it calls a “frontier firm.”
But nearly all the Ignite attendees I talked to said that they hadn’t really deployed agents in their businesses to date, though they were very interested in learning more. Indeed, many said this was a major reason why they were at the conference. But lots of the tools seem to still be in very early stages. That doesn’t mean there won’t be firms putting AI to good use in targeted applications before these all come out—a number of firms are doing that successfully now. That makes sense, but before we see widespread deployments of hundreds or thousands or agents, the foundational tools will need to get more mature, more stable, and more trustworthy.Â
To that end, Ignite seemed like it was creating the foundations, and it’s important for organizations that use Microsoft tools to really understand them. But it will be a while before most of us are willing to build on them in a big way.
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Michael J. Miller
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Michael J. Miller is chief information officer at Ziff Brothers Investments, a private investment firm. From 1991 to 2005, Miller was editor-in-chief of PC Magazine,responsible for the editorial direction, quality, and presentation of the world’s largest computer publication. No investment advice is offered in this column. All duties are disclaimed. Miller works separately for a private investment firm which may at any time invest in companies whose products are discussed, and no disclosure of securities transactions will be made.
Until late 2006, Miller was the Chief Content Officer for Ziff Davis Media, responsible for overseeing the editorial positions of Ziff Davis’s magazines, websites, and events. As Editorial Director for Ziff Davis Publishing since 1997, Miller took an active role in helping to identify new editorial needs in the marketplace and in shaping the editorial positioning of every Ziff Davis title. Under Miller’s supervision, PC Magazine grew to have the largest readership of any technology publication in the world. PC Magazine evolved from its successful PCMagNet service on CompuServe to become one of the earliest and most successful web sites.
As an accomplished journalist, well versed in product testing and evaluating and writing about software issues, and as an experienced public speaker, Miller has become a leading commentator on the computer industry. He has participated as a speaker and panelist in industry conferences, has appeared on numerous business television and radio programs discussing technology issues, and is frequently quoted in major newspapers. His areas of special expertise include the Internet and its applications, desktop productivity tools, and the use of PCs in business applications. Prior to joining PC Magazine, Miller was editor-in-chief of InfoWorld, which he joined as executive editor in 1985. At InfoWorld, he was responsible for development of the magazine’s comparative reviews and oversaw the establishment of the InfoWorld Test Center. Previously, he was the west coast bureau chief for Popular Computing, and senior editor for Building Design & Construction. Miller earned a BS in computer science from Rensselaer Polytechnic Institute in Troy, New York and an MS in journalism from the Medill School of Journalism at Northwestern University in Evanston, Illinois. He has received several awards for his writing and editing, including being named to Medill’s Alumni Hall of Achievement
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