You need to deploy Copilot for Microsoft 365 to your organization but cannot turn it on for everyone at once. A phased rollout lets you release Copilot to specific teams first and expand gradually. Microsoft 365 Groups provide the targeting mechanism for this controlled release. This article explains how to configure a phased Copilot rollout using Microsoft 365 Groups in the Microsoft 365 admin center.
Key Takeaways: Phased Copilot Rollout with Microsoft 365 Groups
- Microsoft 365 admin center > Billing > Licenses > Copilot: Assign Copilot licenses to specific users rather than the entire tenant at once.
- Microsoft Entra ID > Groups > New group: Create a Microsoft 365 group that contains the pilot users for the first rollout phase.
- Microsoft 365 admin center > Setup > Copilot > Manage rollout: Configure the phased rollout policy and link it to the pilot group.
Why Use Microsoft 365 Groups for a Phased Copilot Rollout
A phased rollout allows you to test Copilot with a small set of users before expanding to the entire organization. Microsoft 365 Groups serve as the targeting container because they integrate with license assignment, policy configuration, and user management. You can create a group for the pilot phase, assign Copilot licenses to that group, and then add users to the group in waves. This approach avoids disrupting all users at once and gives your IT team time to monitor performance, collect feedback, and adjust settings.
The rollout relies on two components: license assignment and service policy. License assignment determines who can activate Copilot. The service policy controls when Copilot features become available to those licensed users. By using Microsoft 365 Groups for both, you ensure that only pilot users see Copilot in their apps during the initial phase.
Prerequisites for a Phased Rollout
Before you start, confirm the following requirements are met:
- You have a Microsoft 365 subscription that includes Copilot for Microsoft 365. This requires a qualifying plan such as Microsoft 365 E3, E5, Business Premium, or Business Standard.
- You have purchased enough Copilot licenses for your pilot group. Each user in the group needs an assigned Copilot license.
- Your account has the Global Administrator or License Administrator role in Microsoft Entra ID.
- You have created the Microsoft 365 group that will contain the pilot users. The group must be a security group or a Microsoft 365 group with mail enabled.
Steps to Create a Pilot Group for Copilot Rollout
- Open the Microsoft Entra admin center
Sign in to entra.microsoft.com with your Global Administrator account. In the left navigation, select Groups then All groups. - Create a new group
Click New group. For Group type, select Microsoft 365. Enter a name such as “Copilot Pilot – Phase 1” and a description. Set Membership type to Assigned. Click Create. - Add pilot users to the group
After the group is created, open it and go to Members. Click Add members and search for the users who will participate in the first phase. Select them and click Select. Repeat this step for additional phases by creating separate groups later.
Steps to Assign Copilot Licenses to the Pilot Group
- Open the Microsoft 365 admin center
Go to admin.microsoft.com. In the left navigation, expand Billing and select Licenses. - Select the Copilot product
Click on Copilot for Microsoft 365 from the list of products. You will see the total number of licenses you own and how many are assigned. - Assign licenses to the group
Click the Assign licenses tab. Under Assign to groups, click Add. Search for the pilot group you created earlier. Select the group and click Add. The system will assign a Copilot license to every current and future member of this group.
Steps to Configure the Phased Rollout Policy
- Navigate to Copilot setup in the admin center
In the Microsoft 365 admin center, expand Setup and select Copilot. On the Copilot page, click Manage rollout. - Enable phased rollout
Toggle the Phased rollout option to On. A panel opens where you define the rollout schedule. - Select the pilot group
Under Select groups, click Add groups. Choose the Microsoft 365 group you created for the pilot phase. Click Add. - Set the rollout schedule
Under Rollout schedule, choose a start date and time. Optionally, set an end date. If you do not set an end date, the rollout continues until all users in the selected groups have Copilot enabled. Click Save.
If Copilot Does Not Appear for Pilot Users After the Rollout
Pilot users still see the old Copilot interface or no Copilot at all
The most common cause is a delay in license propagation. License assignment via groups can take up to 24 hours to apply to all members. Wait at least 4 hours and ask the user to sign out of Microsoft 365 apps and sign back in. If the issue persists, verify that the user is a direct member of the group and not a nested member. Copilot license assignment does not support nested group membership.
Copilot features appear for users outside the pilot group
This usually happens when Copilot licenses were previously assigned to individual users or to a broader group. Remove any direct license assignments for users who should not have Copilot yet. Check the Licenses page in the admin center to see all assigned users. If a user was added to the pilot group but also has a direct license, the direct license overrides the group-based assignment. Remove the direct license and keep only the group assignment.
Copilot License Assignment Methods: Group-Based vs Direct
| Item | Group-Based Assignment | Direct Assignment |
|---|---|---|
| Management method | Microsoft 365 group membership | Individual user selection |
| Scalability | High — add or remove users by editing the group | Low — must manage each user separately |
| Supports phased rollout | Yes — use different groups for each phase | No — cannot schedule phased activation |
| Propagation time | Up to 24 hours | Up to 30 minutes |
| Nested group support | No — only direct members receive licenses | Not applicable |
For a phased rollout, group-based assignment is the recommended method. Direct assignment works for immediate, one-time deployments but does not provide the scheduling and targeting control that group-based assignment offers.
Conclusion
You can now schedule a phased Copilot rollout by creating Microsoft 365 groups, assigning licenses to those groups, and configuring the rollout policy in the Microsoft 365 admin center. Start with a small pilot group, monitor user feedback, and then expand to additional groups for later phases. For advanced control, combine group-based license assignment with the Copilot rollout policy to stagger feature availability by date and time. Remember that nested groups are not supported for license assignment, so keep your pilot group flat with direct members only.