One thing Microsoft is not good at is naming things, and sadly it's happened again. But let's go back to the beginning: what are Skills?
Skills are targeted prompts/context that are modular, so they are not always included in the LLM session. They are Markdown files with selected metadata in YAML, all in a file normally named skill.md (the parent folder and YAML metadata identify it).
They were created by Anthropic (Claude) and were designed for both the user to add in a prompt (/Skill), or for the LLM to decide.
Similar to Skills are Plug-ins. These can (and often do) include skill.md files, but can also have scripts, MCP servers, and other tools.
So back to Microsoft naming things badly.
