Generative AI is now being widely embedded into your productivity systems, while this has made completing tasks more intuitive and efficient than it ever was, there is a worrying implication in this trend: Are we being trapped in these productivity ecosystems?
The process is commonly referred to as platform envelopment, and the integration of AI copilots into Microsoft’s Office 365 suite is a textbook example, they are not just enhancing software, but they are bundling their AI into an already dominating platform. According to platform theory, this envelopment occurs when a provider leverages different components of their products and overlapping user bases to subsume adjacent markets. Microsoft is doing this by having their AI assistant Copilot tightly tied to the world’s most used enterprise suite, Office365.
The strategic implication for Microsoft is obvious, leaving Office now does not only mean giving up on familiar productivity tools, but also leaving the AI workflows embedded into these tools. This increases switching costs and deepening dependency, positioning Microsoft as the default provider of enterprise AI. However, for the firms that adopts these platforms, the risk of platform lock-in is evident, once employees restructure workflows around Copilot, alternatives (etc. Google) become harder to adopt, even if they offer better functionality.
The dilemma is then, is integration making companies more efficient, or more vulnerable. Through embracing Copilot, firms gain access to enhancements in productivity and other synergies, but they risk themselves having their fate tied to Microsoft, as they are locked into their pricing, data governance, and how Microsoft decides to further change their products further on. For example, firms are concerned about Copilot potentially “oversharing” within an organization, which can expose confidential files if not properly managed, The CEO of Salesforce Marc Benioff criticized Copilot, calling it “disappointing”, citing issues around oversharing and security (Business Insider, 2024).
Similarly, Google’s handling of AI is also showing how envelopment is playing out. AI features, such as Gemini, are now directly included into Business and Enterprise plans. Meaning firms can no longer easily opt in or opt out of AI functionalities, as they now become part of the base product. Such bundling has simplified processes, but there are complaints about price hikes, even where opt-out is unclear (PPC Land, 2024).
As platform envelopment has been supercharged, going into the future, firms are left with the question, are the productivity and integration benefits more helpful than how vulnerable these platforms leave them, and is there a viable route in maintaining autonomy while still being able to reap benefits?
References:
Business Insider. (2024). Marc Benioff says Microsoft’s Copilot is disappointing and raises security concerns. Retrieved from https://www.businessinsider.com/marc-benioff-salesforce-microsoft-copilot-clippy-2024-9
Concentric AI. (2024). Microsoft Copilot Data Risks Explained. Retrieved from https://concentric.ai/too-much-access-microsoft-copilot-data-risks-explained/
PPC Land. (2024). Google forces Gemini AI on Workspace users amid pricing complaints. Retrieved from https://ppc.land/google-forces-gemini-ai-on-workspace-users-amid-pricing-complaints/
The hidden risks of Productivity suites.
19
September
2025
