Microsoft is broadening its artificial intelligence (AI) strategy by developing its own AI reasoning models, according to a report by The Information, to compete with OpenAI. This move is part of an initiative to diversify Microsoft’s AI offerings and reduce its dependence on OpenAI’s technology.
As part of this strategy, Microsoft has begun testing models from xAI, Meta, and DeepSeek as potential alternatives to OpenAI’s technology within its Copilot product. This shift is reflective of a larger trend in the industry towards more cost-effective AI development through “distillation” techniques. Distillation involves training smaller AI models using the knowledge gained from larger, more complex models, which significantly lowers computational costs. Companies such as DeepSeek have employed this method to build powerful AI solutions at a fraction of traditional expenses.
Currently, Microsoft’s Copilot, an AI-powered chatbot integrated into Microsoft 365 and Windows 11, is dependent on OpenAI’s GPT-4 model. By investing in its own AI model development, Microsoft aims to enhance Copilot’s capabilities and offer more personalized AI solutions to its users. This strategic shift is anticipated to strengthen Microsoft’s position in the highly competitive AI market, providing greater control over its AI ecosystem.
