Microsoft said to diversify from existing OpenAI AI infrastructure to reduce costs.
Microsoft is reportedly concerned about the AI speed and costs for its enterprise clients
Photo Credit: Microsoft
Microsoft is reportedly working on adding non-OpenAI artificial intelligence (AI) models to its 365 Copilot products. As per the report, the Redmond-based tech giant is trying to reduce its dependence on OpenAI's AI models due to concerns regarding speed and cost. To diversify, the company is said to be looking at both third-party models as well as internally developed models. Notably, Microsoft introduced 365 Copilot in March 2023 and one of its unique selling points (USP) was integration with the GPT-4 AI model.
According to a Reuters report, Microsoft is working on bringing internal and third-party AI models to its 365 Copilot products. Citing sources familiar with the matter, the publication claimed that the Windows maker is now actively trying not to depend solely on OpenAI's large language models (LLMs) to offer AI solutions to its enterprise clients.
If true, this will be a big departure from Microsoft's existing AI strategy. The company invested $1 billion (roughly Rs. 8,519 crores) in OpenAI in 2019, followed by another $10 billion (roughly Rs. 85,195 crores) in 2023, as part of its ongoing partnership with the AI firm. The partnership allows Microsoft early access to all the AI models developed by the firm.
As per the report, the tech giant's biggest concern at the time is the cost and speed of the OpenAI-developed AI models. This is a significant sticking point since Microsoft does not use these AI models for internal usage, but the technology is used to build AI products for its enterprise clients.
"We incorporate various models from OpenAI and Microsoft depending on the product and experience," Microsoft told Reuters.
To diversify, the tech giant is reportedly looking at third-party AI models as well as ways to develop LLMs in-house. The company has released several small language models (SLMs), with the latest being the open-source Phi-4 AI model. However, it has yet to develop a general-purpose LLM.
Recently, Microsoft began expanding its GitHub Copilot by allowing developers to access Google's Gemini and Anthropic's Claude AI models. Notably, the GitHub Copilot was the first AI product released by the company after the collaboration with OpenAI. It is possible that in the future, other 365 Copilot tools can also allow users to switch between different models.
Catch the latest from the Consumer Electronics Show on Gadgets 360, at our CES 2026 hub.