Microsoft seeks to pursue an open relationship with OpenAI

Microsoft and OpenAI have had something of a symbiotic relationship: the former donated billions of capital to an emerging AI lab and, in return, gained early access to cutting-edge models that are now integrated into Microsoft’s suite of productivity software . However, the two companies have gone in divergent directions and Reuters reported today that Microsoft is looking to add more models to its 365 Copilot product that are not built by OpenAI.

The reasoning, according to the report, is that Microsoft considers OpenAI’s next-generation GPT-4 model to be too expensive and not fast enough to satisfy its enterprise customers. Copilot 365 is an AI-powered assistant built into Microsoft’s suite of productivity apps, including Word and PowerPoint. The tool is supposed to absorb all of a company’s data and do a host of things, like giving users the ability to quickly find information without needing to search through disparate applications; quickly generate a list of the company’s most profitable business units; or instantly summarize meetings and emails.

Is supposed do those things, but customers and experts alike are still disappointed with Copilot 365, which costs an extra $30 per month per user on a computer. In a recent Business Insider Information historyMicrosoft employees, speaking anonymously, called the tools “terrible” and “effective,” and they don’t work well 75% of the time. On the customer front, Insider business information cited a survey of 123 IT leaders published by management consulting firm Gartner, which found that only four said Copilot provided significant value to their companies. It’s worth noting that a few other stories have reported on companies finding value in using large language models, such as simplifying customer service.

Some customers who spoke with Business Insider Information He specifically noted that 365 Copilot is too expensive.

OpenAI’s ChatGPT is a frontier general model, meaning it is trained on large amounts of data and can be more expensive and slower to run; This is why most models are offered in “light” versions that perform less intensive inference or “thinking.” Microsoft has been training its own smaller internal models, such as one called Phi-4, and Reuters reports that sources who spoke to the outlet said the company is looking to “customize other open weight models to make the 365 Copilot faster and more efficient.”

In a sense, it makes sense that Microsoft wants to reduce its dependence on OpenAI. If the company is right and AI is going to be the next generational shift in computing, relying on an independent company for core technology is not a great idea.

Microsoft has invested billions of dollars in OpenAI and will receive 75% of your profits until you break even on your investment, and even then you will still have a large stake in the startup. In fact, the company can hedge its bets: build its own internal models and hold a lottery ticket in OpenAI in case it continues its current skyward trajectory.

Despite being the front-runner today, some OpenAI skeptics say we may not yet know a real winner in the AI ​​race (if these technologies are as revolutionary as we’re told to believe). Just as there were numerous search engines that appeared online in the 90s, only to be quickly defeated when the newcomer Google appeared. Microsoft is likely wise to protect itself.