Microsoft is reportedly developing in-house artificial intelligence reasoning models, intending to compete with OpenAI and potentially offer these models to developers. This development was reported on Friday by The Information, which cited a source familiar with the project.
The Redmond, Washington-based company, which has been one of OpenAI’s major backers, has started testing models from xAI, Meta, and DeepSeek. This is part of its efforts to find potential replacements for OpenAI in its Copilot product, according to the report.
Microsoft has been aiming to decrease its reliance on the ChatGPT creator, even though its early partnership with OpenAI gave the tech giant a leading position among the major tech companies in the AI field. Reuters exclusively reported in December that Microsoft has been working on integrating internal and third-party AI models to power its flagship AI product, Microsoft 365 Copilot. The goal is to diversify the underlying technology from OpenAI and cut costs.
When Microsoft launched 365 Copilot in 2023, a key selling point was its use of OpenAI’s GPT-4 model.
According to The Information’s report, Microsoft’s AI division, headed by Mustafa Suleyman, has finished training a family of models. These are internally called MAI and perform nearly as well as the leading models from OpenAI and Anthropic on generally accepted benchmarks.
The team is also working on reasoning models using chain-of-thought techniques. This reasoning process generates answers with intermediate reasoning capabilities for complex problems, potentially competing directly with OpenAI’s capabilities, the report noted.
Suleyman’s team is already testing the MAI models, which are significantly larger than the earlier Phi family of Microsoft models, as replacements for OpenAI’s models within Copilot, according to the report.
Microsoft is considering releasing the MAI models later this year as an application programming interface (API). This would allow external developers to incorporate these models into their own applications, the report stated.
Microsoft and OpenAI have not yet responded to Reuters’ requests for comment.
