Microsoft Shifts from OpenAI, Redefines 365 Copilot’s Key Features
Microsoft shifts its focus to reduce reliance on OpenAI, a departure from its previous reliance on GPT-4 for Microsoft 365 Copilot’s key features since March 2023.
Microsoft is a big supporter of OpenAI, and this is their latest move to become less reliant on the AI startup. This is different from the past few years when Microsoft bragged about having early access to OpenAI’s models. When Microsoft 365 Copilot first launched in March 2023, using OpenAI’s GPT-4 model was one of its best features.
According to anonymous sources discussing private matters, Microsoft is considering reducing 365 Copilot’s reliance on OpenAI due to concerns about cost and speed for enterprise users.
A spokesperson for Microsoft said that OpenAI will continue to work with the company on “frontier models,” which are the most advanced AI models that are currently available. The original deal between the two companies lets Microsoft change OpenAI’s models to fit its needs.
Microsoft said in a statement, “We use different models from OpenAI and Microsoft depending on the product and experience.” OpenAI refused to say anything.
The sources also said that Microsoft is working to make 365 Copilot faster and more efficient by customizing other open-weight models as well as training its own smaller models, such as the newest Phi-4.
According to one of the sources, the objective is to reduce the cost for Microsoft to operate 365 Copilot, potentially allowing them to pass those savings on to the customer.
According to the same source, Microsoft’s top executives, including CEO Satya Nadella, are closely monitoring the efforts.
This is the same approach taken by other Microsoft business units when they modify their usage of OpenAI models. In October, GitHub added models from Anthropic and Google as alternatives to OpenAI’s GPT-4o. Microsoft bought GitHub in 2018. In October, the company updated its customer chatbot, Copilot, to utilize both OpenAI and company-made models.
AI Assistant for Business Software
Microsoft 365 Copilot is an AI assistant that comes with Microsoft’s business software, like Word and PowerPoint. The company is still trying to show that it is worth the money that businesses spend on it.
While Microsoft hasn’t given out exact sales numbers on the number of licenses sold, there have been worries about the price and how useful the software is. In August, Gartner, a research firm, conducted a poll of 152 IT companies and found that the majority had not advanced their 365 Copilot projects beyond the pilot stage.
Even so, analysts at BNP Paribas Exane said they have seen a speedy adoption. They think Microsoft will sell 365 Copilot to more than 10 million paid users this year. In November, Microsoft announced that 70% of the Fortune 500 utilize 365 Copilot.
