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Microsoft is planning to make “significant investments” in its own AI chip cluster to become “self-sufficient in AI,” Microsoft AI CEO Mustafa Suleyman said during an all-employee town hall meeting on Thursday.
Microsoft’s AI strategy has so far largely relied on a partnership with OpenAI, although the companies have drifted apart lately and they’re finalizing tense contract renegotiations right now.
Suleyman’s comments suggest Microsoft wants to forge its own path in AI, while still supporting OpenAI with cloud-computing services.
“It’s critical that a company of our size, with the diversity of businesses that we have, that we are, you know, able to be self sufficient in AI, if we choose to,” Suleyman said.
Instead of relying solely on OpenAI, Microsoft is using open-source models, partnering with other AI developers, and building its own models, Suleyman said.
The software giant unveiled MAI-1-preview in late August. This is Microsoft AI’s first foundation model trained end-to-end by the company, and offers a glimpse of future offerings inside its Copilot service. This model ranks 24th among text models on LMArena, a widely followed leaderboard, so Microsoft has a lot of work to do still.
“We should have the capacity to build world class frontier models in-house of all sizes, but we should be very pragmatic and use other models where we need to,” Suleyman said.
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Microsoft plans to make “significant” investments in its own AI chip cluster to help the company build its own models, he added.
Suleyman noted that MAI-1-preview was only trained on 15,000 Nvidia H100s, which he said was a “tiny cluster” in the grand scheme of things. Competing models from Google, Meta, and xAI were all trained on clusters that were six to 10 times larger in size, Suleyman said.
Microsoft has significantly benefited from its arrangement to access OpenAI’s intellectual property, both by selling it to customers through the Azure OpenAI service and creating its own products using OpenAI’s technology, like its AI assistant Copilot. Those terms are being renegotiated and finalized now, helping OpenAI get Microsoft’s blessing for a corporate restructuring.
Microsoft CEO Satya Nadella during the town hall reassured employees that the company still benefits from the partnership.
“We have a very good partnership with OpenAI. We’re very excited to continue to work with them, support them. Remember, OpenAI supplies to us. We supply to them. So they’re each other’s customers. We have a commercial partnership. We are investors,” Nadella said. “And at the same time, we were very clear that we also want to build our own capabilities.”
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