Here’s what’s happening on May 1: Microsoft 365 E7 becomes transactable in CSP on monthly, annual, and triennial terms.

That’s 28 days away. If you haven’t built your upsell motion yet, you’re late.

What E7 Actually Is

E7 bundles four things into one SKU at $99 per user per month: Microsoft 365 E5 (the current top tier), the Microsoft Entra Suite (identity and access management), Microsoft 365 Copilot (the AI assistant layer), and Microsoft Agent 365 (the governance control plane for AI agents).

You’re not selling an upgrade. You’re selling a governance posture. That’s the pitch.

Think of Agent 365 as Intune for AI agents — except instead of managing endpoints, it manages the autonomous workflows your clients’ employees are already building without telling IT. According to Pax8’s breakdown, Microsoft’s own data shows tens of millions of agents appeared in the Agent 365 registry within two months of preview availability. IDC projects 1.3 billion agents in circulation by 2028.

Your clients have agent sprawl right now. They just don’t know it yet.

The Three Things Agent 365 Does

Microsoft organizes Agent 365 around three pillars:

Observe. A centralized Agent Registry gives IT visibility into every agent in the environment — usage analytics, relationship mapping, risk signals. Your clients can’t manage what they can’t see.

Govern. IT-controlled onboarding and lifecycle management through Entra Agent ID. Activate, suspend, retire agents the same way you manage user accounts. When the employee who built the agent leaves the company, IT has a kill switch.

Secure. Conditional Access for agents. Purview DLP enforcement on agent interactions. Threat protection through Defender, including prompt injection detection and data exfiltration monitoring.

That last one is the one your security-conscious clients will respond to immediately. “Your employees’ AI workflows can be hijacked through prompt injection” is a very real risk, and it’s not getting easier to explain once it happens to someone.

Who to Call First

Your Business Premium and E5 customers. That’s the direct upgrade path.

The clients who already have E5 are paying for the security and compliance stack. They probably have Copilot rollouts that are either running loose or not being governed at all. E7 gives them a formalized framework for both, packaged into one bill.

Microsoft is actively pushing partners toward this: starting April 1, the Copilot + Power Accelerate program includes Agent 365 across Immersion Briefings, Envisioning, and proof-of-concept engagements. If you’re doing any of those with customers right now, Agent 365 should be in the agenda.

The conversation to have isn’t “do you want to upgrade?” It’s “do you know how many AI agents are running in your environment right now?” Most IT leads will say no. That’s your opening.

The Governance Angle Is Your Edge

Here’s where a lot of partners are going to miss this. They’ll pitch E7 as the “AI upgrade” and lead with Copilot features. That’s fine for some buyers.

But the defensible pitch — the one that doesn’t get shopped — is the governance conversation. Shadow IT used to mean unapproved apps. Now it means autonomous workflows with full user permissions that nobody’s catalogued. The marketing coordinator who built an agent to process inbound emails gave it her SharePoint access. When she left the company, nobody turned the agent off.

That’s a real scenario. We’ve written about the AI governance gap that MSPs aren’t moving fast enough to fill. E7 is the product that closes it, at least on the Microsoft stack. Your job is to be the person who explains why it matters before the client’s security team figures it out on their own.

The Pricing Math

At $99/user/month, E7 is a step up from E5, which runs roughly $57/user/month in standard CSP pricing, or around $36 for standalone E5 Security. You’re not just selling the AI layer — you’re bundling Entra Suite (typically $12/user) and Agent 365 governance into a single SKU. The math works for clients who were going to buy Copilot anyway.

The clients who weren’t planning to buy Copilot are a harder sell. Don’t force it. Focus your May push on the subset of your E5 base that has active Copilot rollouts or has asked about AI governance in the last six months. That’s your warm list.

What to Do Before May 1

Get current on the Agent Registry. Know what it shows and how to demonstrate it in a customer environment. You don’t need to be the AI expert — you need to be the person who shows them what they can’t see without it.

Talk to your distributor about E7 pricing and margin structure. CSP economics on new bundled SKUs can shift at launch, and you want to know your deal-structure options before the first customer asks.

Brief your sales team on the governance narrative, not the feature list. The feature list is on Microsoft’s website. The governance conversation is where you add value.

The playbook for selling the Microsoft AI stack to SMBs is still being written. May 1 is your chance to be one of the first to have a real answer.

Don’t wait for Microsoft to explain it to your clients for you.