Microsoft is increasingly using AI models it has developed in-house within applications such as Excel and Outlook. The company aims to reduce its dependence on external AI vendors and cut the costs of AI functionality.
Whereas the office applications previously relied primarily on models from OpenAI and Anthropic, tens of thousands of AI requests are now being processed weekly by Microsoft’s own MAI models. This is according to a source familiar with internal developments, as reported by Bloomberg. Microsoft declined to comment on the report.
For now, the use of its own models accounts for only a small portion of Microsoft’s total AI usage. Products like Copilot process many millions of AI prompts each week, so the transition is currently limited to a portion of the total workload. However, this development does show that Microsoft aims to bring more and more AI capacity in-house.
Microsoft aims to cut costs
That strategy has a clear financial rationale, explains SiliconANGLE. Microsoft processes enormous numbers of AI tokens in services like Copilot. Thanks to its long-standing partnership with OpenAI, the company currently still benefits from favorable terms, but it wants to prevent future price increases from external model providers from driving up AI costs further.
During the Build developer conference in June, Microsoft unveiled seven new models within the MAI family. Among them is MAI-Thinking 1, the company’s first reasoning model. According to Microsoft, it delivers performance comparable to that of an earlier generation of Anthropic’s Claude Opus 4.6 for programming tasks, while incurring lower costs. In addition to reasoning, Microsoft also introduced models for image generation, transcription, speech recognition, and programming tasks.
Mustafa Suleyman, who leads the development of Microsoft’s AI models, had previously explained why the company is pursuing this strategy. “Anthropic is extremely expensive, and many organizations are urgently seeking alternatives,” he said last month. According to Suleyman, the ultimate goal is to completely eliminate the costs associated with using Anthropic models.
Microsoft is now also deploying its own MAI models within GitHub Copilot. In addition, Suleyman announced that an internally developed transcription model will be rolled out to Teams and other products in the coming months. With this, Microsoft is gradually expanding the use of its own AI technology across its software portfolio.