You're Probably Paying for SharePoint AI You've Never Switched On

A client called me in November last year, frustrated about their intranet. They'd spent eighteen months and a decent budget modernising the thing, migrating from an old on-premises SharePoint to SharePoint Online, cleaning up permissions, getting site governance in order. Good work. Genuinely useful work. And now they were watching staff still send "quick question" emails about leave entitlements because nobody could find the HR policies site.

"We did all this work," the IT manager said to me, "and nothing's changed."

I asked whether they'd turned on SharePoint Agents.

Silence.

"The... what?"

That conversation is why I'm writing this. Because these features shipped months ago, they're sitting inside the same admin console these teams log into every week, and most organisations have no idea they exist.

What's Actually in There (That You're Not Using)

Let me be specific, because vague "AI can help your organisation" commentary is useless. Here's what Microsoft has shipped into SharePoint in the past twelve months.

SharePoint Agents became generally available at Microsoft Ignite in November 2024 (Microsoft TechCommunity, 2024). An Agent is a custom AI assistant scoped to a specific SharePoint site. You build it in about thirty minutes, no coding involved. You point it at your HR policies library, or your project documentation, or your finance procedures, and staff can ask it questions in plain English and get answers with citations back to the source documents.

The agent appears in both SharePoint and Microsoft Teams. That's important. Your staff doesn't need to navigate to the intranet to use it. They can ask the HR Agent a question right in the Teams sidebar while they're already in a meeting.

Zoom

Image could not be loaded: /images/articles/sharepoint-copilot-ai-features-organisations-arent-using-2026/sharepoint-agents-panel.png

The SharePoint Agents panel in a real tenant, showing site-scoped agents available to staff alongside the Create an agent option

Metadata reasoning went generally available in late 2025. This one matters if you've spent years building out content types and taxonomy in SharePoint. Copilot can now reason over your custom metadata columns, not just the document text. If you've tagged documents with a "Business Unit" column and a "Effective Date" column, Copilot can answer "show me all HR policies updated after January 2025 for the Operations division." Your governance investment finally has a direct AI payoff.

Copilot page generation lets content editors describe a page in plain English and have Copilot draft the structure, headings, and initial text. It can also generate news posts from meeting summaries, which is the kind of low-glamour-but-genuinely-useful automation that actually saves time.

DLP for Copilot Prompts went GA and it's worth knowing about if you're in a regulated environment. Purview DLP now extends to Copilot prompts themselves. If a staff member asks Copilot something that references credit card numbers, health record identifiers, or classified content, the response gets blocked before it comes back. This addresses one of the concerns I've heard from government clients about enabling Copilot at all (Microsoft TechCommunity, 2025).

The Preview Stuff Worth Watching

Two features announced at Ignite 2025 are in preview and heading to GA.

SharePoint Knowledge Agent is in public preview with over 1,800 tenants already testing it (Microsoft TechCommunity, 2025). This is different from a site-scoped Agent. It reasons across your entire SharePoint corpus, including your custom metadata and taxonomy, not just full-text search. GA is targeting early 2026. If your organisation has serious content architecture investment, this is the one to watch.

SharePoint Admin Agent lets you manage SharePoint governance in natural language. Instead of navigating SharePoint Admin Centre reports to figure out what's going on with storage or permissions, you describe the problem and the agent navigates the SAM reports for you. Genuinely useful for under-resourced IT teams who spend half their time clicking through admin dashboards they find confusing.

Content Management Assessment Tool is the one I'd tell every organisation to run right now, before anything else. It's a pre-Copilot readiness report that runs directly from SharePoint Admin Centre. It'll tell you what state your content is actually in, where the gaps are, and what to fix before you start pointing AI at it. I've seen organisations enable Copilot on messy content and wonder why the answers are useless. Run the assessment first. It's not glamorous, but it's the right starting point. One caveat: this tool requires the SharePoint Advanced Management (SAM) licence, which is included in M365 E5 Compliance or available as a standalone add-on at roughly USD $3/user/month.

Why the Adoption Numbers Tell a Depressing Story

Here's the context that frames all of this.

According to analysis published in early 2026, only 3.3% of all Microsoft 365 and Office 365 users have paid for the Copilot add-on (Yahoo Finance, 2026). That's roughly 15 million seats out of a much larger base. 85% of Fortune 500 companies use SharePoint. The gap between "has the platform" and "has the AI layer" is enormous.

Some of that gap is deliberate. Plenty of organisations have assessed the Copilot add-on, looked at the cost, and decided to wait. That's a reasonable decision. I don't think every organisation should be on Copilot licences right now.

But a lot of that gap is just... not knowing what's there. IT teams are stretched. They don't have time to read every Microsoft blog post. The features ship quietly, sometimes as "generally available" announcements buried in TechCommunity posts that most admins never see. And nobody at Microsoft is calling organisations to say "hey, you're paying for E5 licences, have you noticed we've added AI governance tools to your admin centre?"

The result is what I keep finding when I talk to IT managers and digital transformation leads across Australian government and enterprise: people who've been fighting for budget, fighting for executive support, fighting for the time to properly implement SharePoint, and then discovering that the AI capabilities they'd assumed were years away and hugely expensive were already inside their tenant, waiting.

That thought keeps me up at night, honestly. Not in a "doom and gloom" way. In a "this is such a fixable problem" way.

The Australian Context Matters Here

Australia has some of the highest M365 penetration in the developed world, particularly in government and healthcare. The Commonwealth Bank of Australia put 10,000-plus employees on M365 Copilot and reported that 84% said they wouldn't go back to working without it (Microsoft Customer Story, 2024, vendor self-reported). CommBank's scale and regulatory environment make it a meaningful reference point, even accounting for the fact that Microsoft publishes these stories as marketing material.

The government angle is significant. Microsoft's Australian data centres in Sydney and Melbourne support M365 Copilot with Australian data residency. Specific Microsoft Azure services in the Sydney and Melbourne regions appear on the ASD Certified Cloud Services List at PROTECTED level. Agencies should verify M365 Copilot's specific status against their own security risk framework before deployment, as not all services share the same certification scope. It's not trivial, but it's not the blocker that some IT teams assume it is.

I've watched government agencies spend significant money on bespoke chatbot solutions, custom development, and AI vendor contracts while sitting on SharePoint Premium and Copilot capabilities they haven't activated. I understand why it happens. Procurement processes, risk aversion, the preference for dedicated vendors who'll provide a support contract. But the gap between what's available and what's being used is genuinely frustrating to witness.

What the Microsoft Graph Semantic Index Actually Is

There's a technical piece worth explaining because it underpins why Copilot in SharePoint works better than a regular keyword search.

When you have a Copilot for M365 licence, Microsoft automatically builds what's called a Semantic Index across your organisation's content (Microsoft Learn, 2024). This isn't a keyword index. It's a semantic representation of your content that understands meaning and relationships, not just word matches.

That's why you can ask a SharePoint Agent "what's our policy on working from home overseas?" and get a useful answer even if the policy document uses the phrase "remote work from international locations" rather than "working from home overseas." The index understands the concepts, not just the strings.

The Semantic Index is automatic for all paid Copilot for M365 users. There's nothing to turn on. But it only works well if your content is clean and well-structured. Which brings us back to the Content Management Assessment Tool.

For a deeper look at how the Semantic Index works and what it means for how you structure content going forward, read:

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The Licensing Reality (With Actual Numbers)

I'm going to be straight with you about costs because I find the "contact us for pricing" approach in Microsoft documentation genuinely unhelpful.

Note: Verify current AUD pricing at microsoft.com/en-au. Pricing changes and I've been caught out citing outdated figures before.

The Copilot add-on is real money. At $45 per user per month, an organisation with 500 staff is looking at $22,500 per month, $270,000 per year, just for the AI layer on top of existing M365 costs. That's a serious budget conversation, not a quick admin decision.

But you don't have to roll it out to everyone. Most organisations starting with Copilot are doing targeted deployments: specific teams where the ROI case is clearest. HR, legal, project management. Proving value there before expanding. That's the sensible approach.

SharePoint Premium is different and it's worth understanding separately. It's pay-as-you-go, which means you pay per document processed rather than per user per month (Microsoft Learn, 2024). There's a free promotional capacity running through June 2026. That means you can test document AI processing, form recognition, auto-classification, without committing to ongoing cost. If you have a finance team processing invoices manually, or an HR team receiving application forms that need to be classified and routed, the SharePoint Premium capabilities are worth testing right now while the free capacity exists.

The Part That Actually Makes Me Frustrated

Here's what I haven't said yet, and it's probably the thing worth saying most directly.

We've spent years in this industry convincing organisations that SharePoint intranets are worth doing properly. Not just as a file storage system, but as a genuine knowledge management platform. That means governance, content types, taxonomy, metadata, proper site architecture. It's unglamorous work. It doesn't get applauded in executive presentations. Content editors find it tedious.

The AI capabilities that are now shipping depend entirely on that foundational work having been done. The Knowledge Agent reasons over metadata and taxonomy. The Semantic Index works better when content is structured and current. SharePoint Agents produce trustworthy answers when the source documents are accurate and well-maintained.

If you did that governance work properly, you're in a good position. Your AI investment compounds on top of years of content investment. The metadata you spent months building has direct AI ROI now, today, in a way that wasn't true two years ago.

If you didn't, if you've got SharePoint that's basically a network drive with a web interface, full of outdated documents and inconsistent folder structures, then enabling Copilot is going to surface those problems very visibly. Staff will ask the Agent a question and get wrong answers. That's not a Copilot problem. That's a content problem that was always there, just less visible.

The Content Management Assessment Tool I mentioned earlier will tell you which situation you're in. Run it.

A Practical Activation Checklist

Here's what I'd do, in order, if I were an IT manager or digital transformation lead at an organisation that's been sitting on unused SharePoint AI:

1. Check your licensing. Does your org have Copilot for M365 licences? If yes, SharePoint Agents are already available in your tenant. If no, you can still test SharePoint Premium document AI under the free promotional capacity.

2. Run the Content Management Assessment. Go to SharePoint Admin Centre and run this pre-Copilot readiness report before you do anything else. You need to know what you're working with. (Requires the SharePoint Advanced Management licence, included in M365 E5 Compliance or available separately at around USD $3/user/month.)

3. Enable Agents for a pilot site. Don't roll out to the whole tenant on day one. Pick one site with well-maintained content, ideally HR policies or a project documentation library. Navigate to that site and click the Copilot icon in the top-right corner of the page. The Copilot panel opens with the default site agent already active. Site owners can create and manage custom agents directly from that panel.

4. Build your first Agent. Sit down with the site owner. Spend thirty minutes building the Agent together. Point it at the relevant document library. Test it with real questions staff would actually ask. See how it performs.

5. Try Premium free. The pay-as-you-go capacity is there through June 2026 with no commitment. Test document AI processing on a batch of real documents. Invoice processing, application forms, whatever the highest-volume manual classification task is for your organisation.

6. Brief your content teams before expanding. This is the step most organisations skip and then regret. Agents are only as good as the content they're built on. Before you enable broad access, run a content hygiene pass on the sites you're planning to use. Outdated documents, conflicting policies, broken links. Fix those first.

The whole process from "we haven't looked at this" to "we have a working pilot Agent" can be done in a few weeks. The technical setup is not the hard part. The hard part is content quality and change management, which is true of every SharePoint project that has ever existed.

What's Coming (and Why It Matters)

The SharePoint Knowledge Agent hitting GA in early 2026 is the feature I'm watching most closely. Site-scoped Agents are useful, but the Knowledge Agent reasoning across your full SharePoint corpus is a different thing entirely. That's the scenario where someone can ask "find all our documentation about the data retention requirements for customer records" and get an answer that synthesises across legal, compliance, IT, and records management sites simultaneously.

For organisations with serious content depth, that's a genuinely significant shift in what becomes possible. The organisations that have invested in proper SharePoint governance will have a meaningful advantage when that feature lands.

The SharePoint Admin Agent is also interesting from an IT management perspective. Describing your governance problem in natural language and having the system navigate the admin reports for you sounds like a small thing, but if you've ever spent three hours in SharePoint Admin Centre trying to figure out why a specific site has unusual storage growth, you'll understand why that's appealing.

The Honest Assessment

I don't want to make this sound like everything works perfectly and you should just switch it all on tomorrow. That's not my experience and it's not honest advice.

SharePoint Agents work well when the source content is good. They produce embarrassing results when it's not. The Copilot add-on is expensive, and the ROI case needs to be made properly, not assumed. Document AI through SharePoint Premium is genuinely useful for specific workflows but isn't a universal fix.

And there are things I don't know yet. I'm still watching how the Knowledge Agent performs at scale in Australian tenants with complex metadata structures. I haven't personally tested the Admin Agent. Some of this will evolve over the next six months in ways I can't predict.

But here's what I'm confident about: most Australian organisations with M365 licences aren't using the AI capabilities that already exist in their tenant. Not because they can't afford them. Not because they're not ready. Because nobody told the IT team clearly enough that the features are there, how to turn them on, and what they actually do.

If that's you, the Content Management Assessment is your first move. Run it this week. It's free, it's in your admin console right now, and it'll tell you exactly where you stand.

Everything else follows from that.

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