Why is Microsoft transitioning to its own AI models?

The company aims to lower costs associated with third-party technologies like OpenAI and Anthropic while gaining greater control over its AI infrastructure.

Which Microsoft products already use in-house AI models?

Microsoft's MAI models are now integrated into Excel and Word, handling a portion of user queries instead of relying on OpenAI or Anthropic solutions.

What new AI models has Microsoft introduced?

At the Build conference, Microsoft unveiled seven new MAI models, including tools for code generation and text-to-image conversion.

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Microsoft Slashes AI Costs by Shifting to In-House Models

July 7, 2026

Photo: TechCrunch

Quick answer

Microsoft is reducing AI expenses by replacing third-party models from OpenAI and Anthropic with its own MAI solutions in products like Excel and Word.

Microsoft is aggressively optimizing AI deployment costs by reducing its dependence on third-party developers. In Office 365 products like Excel and Word, proprietary MAI models now partially replace solutions from OpenAI and Anthropic. Previously, Microsoft emphasized integrating these companies' technologies, but now prioritizes in-house developments.

At the May 2024 Build conference, Microsoft unveiled seven new MAI models, including tools for automating coding and generating images from text descriptions. This shift reflects a broader IT industry trend where major players seek to reduce AI infrastructure expenses. Similar measures have been adopted by Amazon, Uber, Meta*, and Accenture.

The rising cost of AI adoption has become a significant challenge for tech companies. Some startups are even considering Chinese models due to their lower pricing, despite potential security risks. While Microsoft has not detailed its strategy, cost optimization has clearly become a priority.

* Facebook, Instagram, WhatsApp, and other Meta services are owned by Meta Platforms Inc., whose activities have been recognized as extremist and banned in the Russian Federation.

Common questions

Why is Microsoft transitioning to its own AI models?: The company aims to lower costs associated with third-party technologies like OpenAI and Anthropic while gaining greater control over its AI infrastructure.
Which Microsoft products already use in-house AI models?: Microsoft's MAI models are now integrated into Excel and Word, handling a portion of user queries instead of relying on OpenAI or Anthropic solutions.
What new AI models has Microsoft introduced?: At the Build conference, Microsoft unveiled seven new MAI models, including tools for code generation and text-to-image conversion.

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