Microsoft Corp. has created in-house artificial intelligence models it believes can go toe-to-toe with industry leaders including partner OpenAI, according to a person familiar with the situation.
A family of models Microsoft is developing recently produced test results suggesting that they were competitive with state-of-the art rivals, including products from OpenAI and Anthropic, said the person, who requested anonymity to discuss an internal matter.
The Redmond, Washington-based company has tested how the models, called MAI, might perform on a variety of tasks, including powering elements of the company’s Copilot-branded AI assistants. Copilots are designed to handle a broad range of user questions, as well as provide specific suggestions for people working on documents or taking conference calls.
Microsoft is also developing so-called reasoning models, which are designed to field more complex queries and display human-like problem-solving, the person said. OpenAI and Anthropic, as well as Alphabet Inc., are also plugging away on such models. Microsoft last month incorporated OpenAI’s o1 reasoning model into its Copilot products.
“As we’ve said previously, we are using a mix of models, which includes continuing our deep partnership with OpenAI, along with models from Microsoft AI and open source models,” a Microsoft spokersperon said.
The Information reported on Microsoft’s models work earlier Friday.
Microsoft’s MAI models could eventually lessen the company’s reliance on OpenAI. Microsoft has backed the ChatGPT maker with some $13 billion, and the relationship between the two companies has been a subject of debate in tech industry circles. Microsoft and OpenAI recently renegotiated their deal, announcing in January that OpenAI could power its services with servers from other cloud-computing rivals, so long as Microsoft didn’t want the business itself. Their agreement runs until 2030.
OpenAI declined to comment.
“We’re both successful when each of us are successful,” Microsoft Chief Financial Officer Amy Hood said at a Morgan Stanley conference earlier this week. “So as you go through that process, I do think everybody’s planning for what happens for a decade, or two decades. And that’s important for both of us to do.”
The company already offers a set of smaller, Microsoft-built models, called Phi, and resells AI models made by a wide range of other companies. It has tested how models from companies including Anthropic, DeepSeek, Meta Platforms Inc. and Elon Musk’s xAI would fare backing up Copilot, the Information reported.
“We feel great about having leading models from OpenAI, we’re still incredibly proud of that,” Hood previously said. “But we also have other models, including ones we build, to make sure that there’s choice.”
