Microsoft is about to pull the plug on most internal Claude Code licenses, telling engineers they have to use the company's own GitHub Copilot CLI instead. The Experiences + Devices division — the group behind Windows, Microsoft 365, Outlook, Teams, and Surface — has until June 30 to completely ditch the tool.
Last December, Microsoft gave thousands of employees access to Claude Code, even letting designers and product managers prototype with it. Fast forward six months, and engineers were regularly choosing Claude Code over the newly launched Copilot CLI. The gap between the two products hasn't been closed. Microsoft reportedly considered buying Cursor to bridge the gap but backed off due to antitrust concerns.
E+D executive VP Rajesh Jha sent an internal memo claiming the move is about unifying the toolchain, arguing that Copilot CLI's value lies in Microsoft being able to shape the product directly with GitHub. But June 30 also happens to be the last day of Microsoft's current fiscal year — killing the licenses is a handy way to cut operating costs for the new year.
Canceling Claude Code doesn't affect Microsoft's other deals with Anthropic. Claude models can still be called through Copilot CLI, and they'll continue to serve in Microsoft 365 and Copilot. The Foundry agreement and Cowork integration are unaffected.