Copilot goes cheap as Microsoft phases out OpenAI and Anthropic models to cut costs

Microsoft is replacing AI models from OpenAI and Anthropic with its own in-house models across several Copilot products, including Excel and Outlook.

Microsoft's in-house MAI models are already processing tens of thousands of requests per week in Excel and Outlook, Bloomberg reports. Both apps previously relied more heavily on models from OpenAI and Anthropic.

The in-house models still handle only a small fraction of total requests, but Microsoft wants to keep cutting its spending on third-party AI over time. The MAI models are also available in GitHub Copilot, and a proprietary transcription model is expected to ship in Teams soon.

At the Build conference, Microsoft unveiled seven new AI models, including MAI-Thinking 1, its first reasoning model. Microsoft claimed it could match Sonnet 4.6 and Opus 4.6 in coding based on human evaluations. But the benchmarks released at the time told a different story, with Thinking-1 trailing the competition from OpenAI and Anthropic by a wide margin and landing roughly on par with Deepseek V3.2.

Customers may get less capable AI for the same price