Beyond the Licence: Lessons from a Global Microsoft E7 Transformation and AI adoption

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Who should listen: Microsoft 365 service owners, licensing and procurement leads, and identity or AI governance teams evaluating E7, Agent 365 or consumption-based Copilot services in large, multi-region organisations.

Guest: Ally Ward and Kevin Spence — Microsoft Lead; Technical Lead, M365 Platform, Norton Rose Fulbright

Ally Ward, Microsoft lead at global law firm Norton Rose Fulbright, and Kevin Spence, her technical lead across the M365 platform, walk through moving 2,500 of their 8,000 users from E5 to E7. The conversation covers the licence mechanics and grace-period traps, Agent 365's reporting and licensing gaps, Entra Suite as a bundled bonus, and how they are tracking Cowork consumption credits.

Many thanks to Luware, sponsor of this episode.

Key insights

• All 2,500 existing Copilot users are being moved to E7 out of an 8,000-user E5 estate. Years of layered licensing groups (separate groups for E5 workloads, for Copilot, and per region for things like transcription-without-recording) now have to be collapsed. Ally's pragmatic answer is to separate licence-assignment groups from functionality groups so features can still be controlled independently. ▶ 4:08
• The grace period is roughly 90 days from the licence start (1 July in their case) to complete the transition before the old licences disappear and Microsoft charges for over-consumption. Three months sounds generous but is not in a complex multi-region firm where operational teams did not know the work was coming. ▶ 6:40
• The hotel-room analogy: 1,000 E5 licences are standard rooms and 200 Copilot licences were upgrade vouchers that cost nothing if unused. Under E7 those rooms become executive suites whether or not anyone stays in them — assign only 100 of 200 E7s and the other 100 have already consumed their underlying E5 capacity. An unassigned E7 does not sit on the shelf. ▶ 7:41
• Order of operations for the migration matters: assign E7 first, wait a good 24 hours for it to take effect, then remove the Copilot licence, then remove the user from the old E5 SKU. Unassigning first leaves users temporarily unlicensed and generates service desk calls about not being able to open Teams or Word. ▶ 9:43
• Because E7 consumes E5 capacity, the firm can no longer buy licences in bulk and hold them in reserve while users complete terms-and-conditions sign-off and training. They are shifting to just-in-time purchasing where regions request E7 once a ready group of users is identified — accepting more approval overhead and a rebuild of the joiners-movers-leavers process and service desk documentation. ▶ 13:18
• Entra Suite (plus Intune Suite in E3/E5) is the sleeper benefit in E7 — identity governance, VPN, web filtering and photo/face ID verification on top of authenticator. The catch is partial coverage: with only E7 users entitled, the identity governance tooling cannot be used estate-wide, which may justify buying the Entra Suite add-on for the remaining E5 users. ▶ 15:21
• Agent 365 reporting only works at whole-tenant level with no regional breakdown, so raw data has to be extracted and merged into existing Copilot reporting. The single pane of glass is an admin console that cannot be handed to end users or regional owners, so dashboards showing ownerless or unused agents have to be built in-house. ▶ 19:55
• Agent 365 licensing for agent consumers is unclear: agents built by a licensed Copilot user end up owned by a service account and used by unlicensed staff. The benefit-derived rule is not currently enforced, but the risk is controls being imposed later and forcing firm-wide Agent 365 purchase. ▶ 20:56
• On a 30-day Cowork pilot with 20-25 users, 175,000 credits (one credit equals one US cent, roughly $1,750) were consumed in under a month, with the most senior people burning the most. Ally logs every prompt, its intent and its cost via /cost to judge value; both guests admit their own pattern is to push Copilot until it fails and only then escalate to Cowork — a judgement call that is unrealistic to expect from a typical business user. ▶ 34:18
• Agent governance is not an IT decision. Beyond platform controls (which connectors, whether agents can send email) it needs firm-level strategy: who governs centrally versus regionally, who approves duplicate agents, who funds and manages credit spend, compliance over data access and retention, plus policies, standards and dashboards. Buying E7 does not buy the people layer, and Microsoft should be clearer with large customers about the roles and time required. ▶ 29:39

Insights summarised by AI from the episode transcript, reviewed by the Empowering.Cloud team.

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