Declarative vs custom engine agent: which one needs extra hosting, which one can act on its own

This sheet compares Declarative agent, Custom engine agent.

CriterionDeclarative agentCustom engine agent
HostingNone needed - uses Copilot's own orchestrator and foundation modelNeeds its own orchestrator/model hosting - typically outside Microsoft 365 on cloud services such as Azure, at extra cost (Copilot Studio can host some cases in Microsoft 365)

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