5 AI Defaults That Just Changed in Your Microsoft 365 Tenant

November is a busy month for AI in Microsoft 365. Several changes landed with defaults that favour adoption, not governance. None of them is dangerous on its own. Together they decide who can build agents, who can run code and who can burn credits in your tenant.

The Problem

Most of these changes arrived as Message Center posts. They are easy to skim and easy to miss. The defaults are “on” for many users, and some settings pick up new services automatically. If nobody looks, your tenant governance is whatever Microsoft shipped this week.

The Nugget

1. Users can now create agent blueprints (Entra)

Since 4 November 2026, default users can create agent blueprints in Entra Agent ID. Rollout completes by late November.

Check: Entra admin center > Entra ID > Users > User settings > Default user role permissions > Users can create agent blueprints. Set it to No if you have no agent strategy yet. Give the Agent ID Developer role to the people who should build agents.

This setting is separate from Users can register applications. Review both. Existing blueprints are not touched.

Ref: MC1506733

2. Spending policies auto apply new services

Copilot spending policies have Auto apply new services enabled by default. Every new service that consumes Copilot Credits is added to the policy without a review.

Check: Microsoft 365 admin center > Copilot > Cost Management > Configuration. Open each spending policy and decide if new services should land there automatically. For production policies, turn it off and add services on purpose.

3. Copilot Code is live for Frontier users

Copilot Code is rolling out in Frontier. Cloud coding sessions are on by default for eligible users with a spending policy. Users in a policy with auto apply enabled get it automatically. Local coding on PC stays off until an admin changes Code execution location to “Cloud and local”.

Check: Who is in Frontier and which spending policy covers them. Keep execution location on Cloud until you have reviewed what local sessions can touch (files, tools, terminal).

Ref: MC1519871

4. Premium models appear in the model selector

Usage based billing models now show up in the Copilot Chat model selector and in Word, Excel and PowerPoint. Frontier started in early November. General availability follows in early December. Users only see them with a Copilot licence, usage based billing enabled and an applicable spending policy.

Check: Set a per user monthly budget (minimum 2,000 credits) so one power user cannot drain the pool. Configure alerts with a threshold and a real recipient. Plan how users request more credits, because Microsoft will add a request flow later.

Ref: MC1519122

5. Targeted release is frozen

Since November, you can no longer add or remove Targeted release users. The option retires in January 2027. It is replaced by Frontier, Standard and Deferred. Frontier is now the door to early AI features like Copilot Code.

Check: Copilot > Settings > View all > Copilot Frontier. Make sure only your pilot group is enrolled. Choose Standard or Deferred for everyone else and update your release process documents.

Ref: MC1490899

Why This Matters

These five settings are connected. Frontier decides who sees new AI features first. Spending policies decide who can pay for them. Entra decides who can build agents. If one of them is wide open, the others lose their value.

What Admins Should Do

1. Set Users can create agent blueprints to No and assign Agent ID Developer to named builders.
2. Turn off Auto apply new services on production spending policies.
3. Scope Frontier to a security group of pilot users only.
4. Add per user budgets and alerts before premium models reach general availability in December.
5. Document every decision. Your security and compliance team will ask.

Pro Tip

Create one security group for AI pilots and use it everywhere: Frontier enrolment, a dedicated spending policy and the Agent ID Developer assignment. One group, one owner, one place to review. When a new AI service lands next month, you already know who gets it first.

Sources

1. MC1506733: Review who can create agents in Microsoft Entra
2. MC1519871: Copilot Code is rolling out in Frontier
3. MC1519122: Microsoft Copilot usage based billing models in Chat, Word, Excel and PowerPoint
4. MC1490899: Microsoft 365 Targeted release retirement
5. Microsoft Learn: Managing AI experiences enabled by usage based billing (learn.microsoft.com)