Microsoft ramps up AI to compete with OpenAI

Microsoft is increasing its efforts to compete with OpenAI, a long-time collaborator, through the development of its own powerful AI models, and exploring alternative ways to power Microsoft’s Copilot Bot.

Microsoft’s AI “reasoning models” are comparable to OpenAI’s O1 and o3 mini, the The Information has reported. Microsoft has reportedly asked OpenAI for technical details on how o1 functions, but OpenAI has refused. This has stoked tensions between the two firms. Microsoft has developed a family called MAI which is competitive with OpenAI. Bloomberg reports that Microsoft is considering offering these AI models through an API in the second half of this year. Microsoft is also testing other AI models, including xAI, Meta and Anthropic as possible replacements for OpenAI in Copilot.

Microsoft has made a number of moves to hedge its bets, including hiring DeepMind and Inflection’s co-founder Mustafa Suleyman as the head of its AI efforts. Subscribe to the latest tech news with our newsletter