Agent 365: Microsoft’s Efforts to Give AI a Digital Identity

Microsoft CEO Satya Nadella has hinted at a significant change in the company’s focus, indicating a shift towards building products and infrastructure for autonomous AI agents in addition to human users.

Nadella emphasized the importance of considering the business per agent, rather than per user, during a recent podcast interview with Dwarkesh Patel.

At the ongoing Ignite conference, Microsoft is introducing new products aimed at enabling IT departments to manage and secure their AI workforce, treating them similar to human employees.

The highlight of the event is the unveiling of Microsoft Agent 365, a central management dashboard within the Microsoft 365 Admin Center designed to oversee a company’s entire AI workforce, providing unique identifications for each agent.

This system allows companies to utilize existing security measures to monitor agent activities, control data access, and prevent security breaches or data leaks.

Microsoft’s approach tackles the issue of “Shadow AI,” where employees resort to unmanaged AI tools, which has become a prevalent concern for businesses in 2025.

The tech industry sees a significant opportunity in the AI agent market, with estimates projecting 1.3 billion agents by 2028 and substantial market growth from $7.8 billion in 2025 to over $50 billion by 2030.

Other tech giants like Google, Amazon, and Salesforce have also launched their own AI platforms, catering to corporate needs.

Various AI agents were announced at the Ignite conference, including autonomous Sales Development Agents, Security Copilot agents, and Word, Excel, and PowerPoint agents.

Microsoft’s Agent 365 leverages the company’s expertise in corporate identity and security systems, seamlessly integrating AI agents into existing tools used by businesses.

Each agent in the Microsoft system receives its unique identity within Microsoft Entra, formerly Active Directory, streamlining the management process for IT teams.

Microsoft is introducing Agent 365 through its early-access program, Frontier, starting this week in preview, with pricing details yet to be disclosed.