
Microsoft joins AI cost-cutting trend by relying more on its own models
Quick Answer
Microsoft is shifting towards its own MAI models for cost savings, reducing reliance on OpenAI and Anthropic for Excel and Word.
Quick Take
Microsoft is shifting towards its own MAI models for cost savings, reducing reliance on OpenAI and Anthropic for Excel and Word. This move reflects a broader trend among tech companies, including Amazon and Meta, to cut AI-related expenses amid rising costs.
Key Points
- Microsoft deploys its own MAI models in Excel and Word to cut costs.
- The company launched seven new MAI models at its Build conference last month.
- Other tech giants like Amazon and Meta are also reducing AI spending.
- Rising AI service costs are prompting companies to explore cheaper alternatives.
- Some firms are considering Chinese models despite security concerns.
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As AI costs continue to rise, companies are looking for ways to cut back. The most recent example is Microsoft, which has reportedly begun to deploy a cost-savings strategy by relying less on software from OpenAI and Anthropic and instead deploying its own in-house models.
Indeed, when it comes to two of its most widely used programs — Excel and Word — Microsoft has begun to use its homemade MAI models to respond to a certain percentage of user prompts, Bloomberg reported Tuesday. In the past, the company had advertised the fact that large parts of Office 365 are powered by models from both OpenAI and Anthropic.
While Microsoft still relies on those third-party models, it has also increasingly sought to stand up its own AI agents. Last month, at its annual Build conference, the company announced the launch of seven new MAI models, including an agentic coder and a text-to-image generator.
When reached for comment by TechCrunch, Microsoft said that it had nothing further to share.
Microsoft’s apparent cutbacks are part of a broader trend. After a brief blitz of “tokenmaxxing” earlier this year, the last few months have seen a news cycle awash in stories about tech companies acting significantly more thrifty. Other large companies — like Amazon, Uber, Meta, and Accenture — have also reportedly made moves to curb spending.
The immense cost of providing and buying AI services has become a controversial part of the industry. The sticker shock has gotten so bad in some parts of Silicon Valley that some companies are reportedly looking to Chinese models for more affordable agentic solutions — despite some concerns over potential security issues.
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