The company has succeeded in a tour de force by establishing itself as a leader in innovation. But she must now succeed in the monetization of her massive investments in Openai and manage her relations with the Trump administration.
Before the arrival of Satya Nadella at the helm, in 2014, Microsoft, although very profitable, was considered by many as an IT dinosaur, having missed several revolutions, in particular that of the smartphone, initiated by its large Apple rival, and whose economic model, focused on the sale of software licenses for computers, seemed threatened by the rise of the cloud.
Since then, Microsoft’s leader has managed to put his business back on the innovation rails. He knew how to choose his battles, closing in 2016 the branch of Microsoft devoted to telephony, three years after the acquisition of Nokia who had turned to fiasco for the computer giant. Satya Nadella has also made a massive reorganization of its engineering teams to give the Cloud priority on the sacrosanct Windows, multiplying partnerships, acquisitions and investments aimed at strengthening Azure.
Successful bet, since Microsoft is now number 2 in the world of computers in clouds, behind Amazon, and even won juicy contracts on the nose of it. Microsoft also discovered a golden egg hen through Openai, in which the company invested for the first time a billion dollars in 2019, long before the chatgpt release. It then led Microsoft to put an additional $ 11 billion on the table to promote its expansion.
Towards the end of the Microsoft monopoly on Openai
If Microsoft had a hollow nose by betting very early on Openai and the generative AI, it is however still far from having won the battle around this rupture technology. First, its OPENAI control was recently eroded, in the first place with the Stargate project, announced by the White House at the end of January. A gargantuan investment program of $ 500 billion in AI, in which Openai, the Japanese conglomerate Softbank, Oracle and the Emirati MGX fund participate. Since the signing of this agreement, Microsoft is no longer the exclusive cloud supplier of OpenAI, which is now free to use Multicloud to meet its insatiable computer power needs. Since the record fundraising of $ 40 billion carried out by OPENAI in March, Microsoft is no longer the majority investor of the company, overshadowed by SoftBank, which participated in the fundraising up to $ 30 billion.
Microsoft can no longer consider OPENAI as an achievement likely to guarantee its supremacy on the generative AI. “It is absolutely critical that Microsoft becomes autonomous on long -term AI,” said Mustafa Suleyman recently, who pilots the IA strategy of Microsoft, at CNBC.
Admittedly, the two companies remain very close to each other: Microsoft retains exclusivity on OpenAi’s application interfaces, which allows it to integrate the most advanced LLMS of Openai, like GPT-4.5, in its own products, including Copilot. But also access to the intellectual property of the company of Sam Altman, with the key to the possibility of using the research of the start-up to design its own generative AI solutions. The two companies also always have a model for sharing the income in force. All the elements of this partnership are in place at least up to 2030.
Make the general public
No reason to panic immediately, therefore, but it appears to be more than necessary for Microsoft to prepare the future by focusing on its own cutting -edge AI solutions to keep its advance in this area. For the time being, the company seems to want to delay and leave the leaders of the generative AI like OPENAI continue to carry out the costly research work (which is now no longer funded mainly by Microsoft …), then building models based on these discoveries, and capable of meeting specific business needs. This is at least the strategy that Mustafa Suleyman took place in his interview with CNBC.
An intelligent strategy, since it puts on the strengths of Microsoft: rather than exhausting its own foundation model to compete with Openai, Anthropic and Google, Microsoft would thus be content to do what it has always been very well done, namely to get out of products that meet the needs of companies, marketers them and selling them effectively, responding to the imperative of the IA genetive. For the time being somewhat disappointing.
The computer giant thus develops, under the code name Phi, a series of small specialized language models, which can be used by computer science on the outskirts and on computers, and from a single GPU, making them much more economical to use. The objective: to make AI a convenience usable by all, and thus ensure a preponderant place in the change of platform that this technology increases. Microsoft is of course not the only one to explore this horizon: Amazon and Alibaba, among others, also work this track. But Microsoft has the advantage of being able to rely on Openai.
Manage the Trump administration
If in the medium and long term, Microsoft must think of its strategy around the AI, in the shorter term, it must deal with another difficulty: Donald Trump, who has always maintained conflictual relationships with the world of tech and seems to want to adopt an approach to the fight against monopolies in line with that of his predecessor. Trump also went on a crusade against Dei (diversity, equity and inclusion), the policies implemented by large companies to give more room to minorities and respond to the demands of the American left following the giant social movements following the death of George Floyd in the summer of 2020.
There too, Microsoft can capitalize on its forces: the first major tech company to have undergone an anti -trime trial in the late 1990s, during which she had just escaped dismantling, she has since become an ace of sober, but effective lobbying. During Donald Trump’s first mandate, unlike Jeff Bezos and Mark Zuckerberg (who are now redoubling their efforts to restore their coat of arms to the president), Satya Nadella took care not to make herself an enemy of the president, without avoiding being displayed too openly with him so as not to offend the American progressive public and his own employees, very mostly democrats.
A strategy pursued since the start of Trump’s second term, Microsoft’s leader who has made discreet visits to Mar-A-Lago and gave a million dollars for the president’s inauguration ceremony. But he did not go to the ceremony, opting rather for Davos. At the same time, where companies like Amazon, Meta and Google have cut in their dei policy, even removed it, Microsoft reaffirmed its commitment in this sense in January through the voice of its Chief Diversity Officer, Lindsay-Rae McIntyre, which said that diversity allowed the company to offer better products to the public. However, the company has also taken symbolic measures likely to please the Trump administration, such as the immediate dismissal of two employees who interrupted an event organized for the 50th anniversary of the company with pro-Palestinian slogans.
While the Trump administration must soon establish rules potentially restoring the installation of data centers by the American cloud giants in certain hostile countries and providing its own regulation framework for AI, Microsoft has every interest in not having too many enemies in the White House, while walking on eggs to avoid being displayed too much with Trump and paying for the public, as Elon Musk recently experienced. Fortunately, its leader seems to be master in this approach.
