Microsoft diversifies AI models for its 365 Copilot product, Reuters reports

Investing.com — Microsoft (NASDAQ:MSFT) has been incorporating internal and third-party artificial intelligence models into its AI product, Microsoft 365 Copilot, Reuters reported on Monday, citing sources familiar with the matter.

This move aims to diversify from the current technology from OpenAI and reduce costs, the report said.

Microsoft, a significant supporter of OpenAI, has been trying to decrease its reliance on the AI startup, Reuters reported. This strategy marks a shift from previous years when Microsoft highlighted its early access to OpenAI’s models.

The tech giant is also trying to cut down 365 Copilot’s dependence on OpenAI due to concerns about cost and speed for enterprise users, the report added.

A spokesperson from Microsoft told Reuters that OpenAI remains a partner for the company on frontier models, which are the most advanced AI models available. The existing agreement between the two companies allows Microsoft to modify OpenAI’s models.

Microsoft is training its smaller models, including the latest Phi-4, and is customizing other open-weight models to enhance the speed and efficiency of 365 Copilot, the report said, adding that the aim is to reduce the cost of running 365 Copilot for Microsoft and potentially pass these savings on to the end customer, one of the sources stated.

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