One of the most common questions IT admins and MSPs ask after a scan isn't about configuration — it's about licensing. "Do I need Defender for Business or Defender for Endpoint P2 for this?" "Can I add Copilot for just the exec team, or does it have to be everyone?" "What's the difference between an EA and a CSP annual commitment on this feature?"
These are exactly the questions that don't have a clean answer in the Microsoft documentation, because the answer almost always depends on what you already have and how you buy. M365Clarity now has the context to answer them properly.
The AI chat — previously scoped only to configuration what-if questions — now also answers Microsoft 365 licensing questions grounded in two new data sources:
Your active licences — pulled directly from your tenant's subscribed SKUs at scan time. M365Clarity knows exactly what you have purchased, how many seats, and how many are consumed.
Your agreement type and cloud — set once in Tenant Settings. Whether you're on CSP monthly, CSP annual, a Microsoft Enterprise Agreement, MCA, or direct, the answer to a licensing question is often different depending on how you buy.
With both pieces of context in hand, the AI can give you answers that are actually specific to your situation — not generic Microsoft documentation that assumes you're an EA customer with a licensing desk.
Microsoft 365 licensing isn't uniform across purchase routes. The same SKU behaves differently depending on how you've contracted it:
| Agreement type | How licence changes work | Minimum term |
|---|---|---|
| CSP monthly | Add or remove at any time, billed monthly | None |
| CSP annual | Add mid-term, remove only at renewal | 12 months per seat |
| Enterprise Agreement (EA) | True-up annually; mid-term additions allowed, reductions at renewal | 3-year enrolment |
| Microsoft Customer Agreement (MCA) | Similar to CSP — monthly or annual depending on term selected | Varies |
| Direct / Pay-as-you-go | Monthly billing, cancel anytime | None |
When you set your agreement type in Tenant Settings, the AI factors this into its answers. A CSP monthly customer asking whether they can add five Copilot licences for the exec team gets a different answer to an EA customer who might need to assess the true-up implications first.
The Licence Advisor is deliberately conservative about two things. It will not quote specific prices — Microsoft pricing changes, varies by region, and varies by partner negotiation. And it will not give definitive answers for agreement-specific terms that may differ from Microsoft's standard published behaviour — EA customers in particular often have negotiated conditions that aren't visible to M365Clarity.
Every licensing answer ends with a recommendation to confirm with your Microsoft partner or via the Microsoft admin centre before purchasing. That's not a cop-out — it's the correct advice, and it's the honest limit of what any automated tool can reliably say about a commercial agreement.
GCC and sovereign cloud: If your tenant is on GCC, GCC High, or DoD, feature availability and licensing terms sometimes differ from the commercial cloud. Set your cloud type in Tenant Settings and the AI will flag sovereign cloud differences where relevant.
Open Tenant Settings from the dashboard sidebar. You'll find two new dropdowns under Licence Context:
Agreement type — choose from Direct/Pay-as-you-go, CSP (monthly), CSP (annual), Microsoft Customer Agreement (MCA), Microsoft Enterprise Agreement (EA), Education, or Non-profit.
Microsoft cloud — choose Commercial, GCC, GCC High, or DoD.
Save once. These values are stored per tenant — MSP users can set different agreement types for each client. The next time you open the AI chat and ask a licensing question, both the agreement context and your live SKU data are injected automatically.
On the Multi-Tenant plan, licence context is set per client — because your clients are on different agreement types, different clouds, and have different SKU sets. An SMB on CSP monthly has different procurement options to an education institution or a US DoD contractor on GCC High.
The AI chat is scoped to the tenant you have open, so the licensing answers it gives are always specific to that client's situation — not generic advice that might be wrong for a different agreement type in a different client account.
Set up Licence Advisor
Open Tenant Settings, set your agreement type and cloud, then ask the AI your first licensing question.
Go to Tenant Settings →Related articles