A Microsoft Copilot alternative for Australian businesses

If your organisation already runs on Microsoft 365, Microsoft 365 Copilot is hard to beat for work inside Outlook, Teams, Word and SharePoint. Teams look for a Microsoft Copilot alternative for other reasons: they don't have the qualifying Microsoft 365 licences, they want every AI request processed in Australia now rather than later, or they want a simple standalone assistant at a predictable price. This page lays out the facts, as of October 2026, so you can choose.

The short version: Copilot Chat comes with eligible Microsoft 365 plans at no extra cost. The full Microsoft 365 Copilot licence costs from AU$31.40 per user per month (excluding GST) on top of a qualifying plan. Microsoft stores Copilot interactions in Australia for Australian tenants, but model processing can happen overseas, and Microsoft expects in-country processing for Australia by the end of 2026. AusGPT is A$29 per user per month, needs no other subscription, and stores and processes everything in Australia.

A note on names: Microsoft Learn says Microsoft 365 Copilot is now called Microsoft Copilot, and Microsoft 365 Copilot Chat is now Microsoft Copilot Chat. Microsoft's Australian pricing pages still use the older names, so this page does too.

Copilot Chat vs Microsoft 365 Copilot#

Microsoft sells two different things under the Copilot name, and the difference matters for cost and data.

• Copilot Chat is included at no extra cost for Microsoft Entra users with an eligible Microsoft 365 subscription. It answers from the web and the latest language models, accepts file uploads (limits apply) and includes IT controls and enterprise data protection. Agents in Copilot Chat are billed on metered pricing.
• Microsoft 365 Copilot is a paid licence. It grounds answers in your work data through Microsoft Graph (emails, chats, documents and meetings), adds Copilot inside Word, Excel, PowerPoint, Outlook and Teams, and includes Microsoft's prebuilt agents such as Researcher and Analyst.

Copilot only shows people the content they already have permission to see, so Microsoft advises using Microsoft 365 permission models, such as SharePoint permissions, to make sure the right people have access to the right content before you roll it out.

Microsoft 365 Copilot licensing and price in Australia#

You can't buy Microsoft 365 Copilot on its own. Microsoft Learn lists the qualifying plans:

• Microsoft 365 Copilot Business: Microsoft 365 Business Basic, Business Standard or Business Premium, Microsoft 365 Apps for Business, or Microsoft Teams Essentials. Microsoft's business offers are for up to 300 users.
• Microsoft 365 Copilot (enterprise): plans including Microsoft 365 E3, E5, F1 and F3, Office 365 E1, E3, E5 and F3, Microsoft 365 Apps for Enterprise, and several Teams, Exchange, SharePoint and OneDrive plans. Microsoft 365 E7 includes Copilot.

Microsoft publishes Australian-dollar prices:

Prices as listed on microsoft.com/en-au in October 2026. Microsoft shows these prices excluding GST. Microsoft also lists cheaper bundles without Teams. Between 1 July and 31 December 2026, Microsoft is offering the Copilot Business add-on from AU$26.91 per user per month for the first year on an annual commitment, for existing customers with an eligible Business plan.

Where Copilot stores and processes data for Australian customers#

Storage. Under Microsoft's Product Terms, if a commercial tenant is provisioned in Australia, Microsoft stores Exchange, SharePoint, OneDrive and Teams content at rest in Australia, along with stored content of interactions with Microsoft 365 Copilot and Copilot Chat. Microsoft says these commitments come at no additional cost.

Processing. Microsoft Learn says Copilot calls to the language model are routed to the closest data centres in the region but can call into other regions when capacity is needed during high utilisation, and that customers outside the EU may have their queries processed in the US, the EU or other regions.

In-country processing. In November 2025 Microsoft announced in-country processing of Copilot interactions for 15 countries, saying customers in four of them, including Australia, would have the option by the end of 2025. An editor's note dated 3 April 2026 revised this: local inferencing for Microsoft 365 Copilot is now expected in Australia by the end of 2026. That was the latest Microsoft timing we could find on 9 October 2026, so confirm the current status with Microsoft before relying on it.

Anthropic models. Microsoft makes Anthropic's Claude models available in Copilot, Researcher, Copilot Studio and Copilot in Microsoft 365 apps, and turns them on by default for most commercial cloud customers outside the EU, EFTA and UK, so most Australian commercial tenants have them on unless an admin changes the setting. Microsoft Learn says these models are currently excluded from the EU Data Boundary and, when applicable, from in-country processing commitments. Admins can disable Anthropic as a subprocessor in the Microsoft 365 admin center. Some advanced Anthropic models labelled "with Data Retention" are off by default and, if enabled, are governed by Anthropic's own terms rather than Microsoft's.

Training. Microsoft says prompts, responses and data accessed through Microsoft Graph aren't used to train foundation language models, including those used by Copilot.

Copilot vs AusGPT at a glance#

Microsoft details as of October 2026, from Microsoft's Australian pricing pages and Microsoft Learn.

Who should use Microsoft 365 Copilot#

Choose Copilot if:

• Your work lives in Microsoft 365. Copilot works inside Outlook, Teams, Word, Excel and PowerPoint, summarises meetings, and answers from the emails, chats, documents and meetings each person can access. A standalone tool can't do that without integrations.
• You already pay for the right licences. If you have Business Standard, Business Premium or E3/E5, adding Copilot is an admin task, and staff can try Copilot Chat at no extra cost first.
• You rely on Microsoft Purview. Copilot interactions can be covered by your retention policies and found with eDiscovery and Content search, alongside the rest of your Microsoft 365 data.
• You want agents across your business systems. Copilot Studio agents published to Microsoft 365 Copilot are included for licensed users.

When AusGPT is the better Copilot alternative for business#

• Teams without qualifying Microsoft 365 licences. AusGPT works on its own: sign up, invite your team and start. There's no base licence to buy first.
• Organisations that need processing in Australia today. Every AusGPT request uses Amazon Bedrock's Australian cross-region inference, which routes Claude requests only between AWS Sydney and Melbourne. Conversations and documents are stored on AWS in Sydney, and dictation uses Amazon Transcribe in Sydney.
• Sensitive work kept apart from your general tenant. Some teams prefer a separate, purpose-built workspace for client, patient or participant information. Prompts, documents and responses aren't used to train AI models, and Amazon Bedrock doesn't share them with Anthropic or other model providers.
• People who want Claude without extra configuration. In AusGPT, Claude is the assistant, processed in Australia. See Claude in Australia.
• Budget holders who want a simple number. A$29 per user per month with 2,000 messages per user, and a free trial. Enterprise adds SSO, custom integrations with business systems, analytics and audit logs.

AusGPT is a good fit for healthcare, NDIS providers, professional services and construction and trades teams who want AI without a Microsoft 365 rollout project.

Things to weigh before you decide#

• Count the full cost. Copilot's price sits on top of a Microsoft 365 plan. If you'd only buy Microsoft 365 to get Copilot, compare the bundle price, not the add-on.
• Decide where processing must happen. If your risk assessment requires AI processing in Australia, check Microsoft's current in-country status and your Anthropic model setting before you rely on Copilot for that work.
• Tidy permissions first. Copilot surfaces what people can access. Review SharePoint and Teams sharing before rollout.
• Consider running both. You can keep Copilot for email and meetings and use a separate tool for specific teams or data. Write down which tool is approved for which information in your AI use policy.
• Test with real tasks. Trial both on the same documents and prompts your staff use every week.

Our security page explains how AusGPT handles data, and you can talk to our team about Enterprise options such as SSO.