Press "Enter" to skip to content

Microsoft and OpenAI: A Rocky Relationship, While AI Prices Tumble

So, let’s look at the platforms.

Amazon Web Services has announced the launch of DeepSeek-R1 as a fully managed large language model in Amazon Bedrock, marking a significant step in cloud-based AI capabilities. This model offers advanced reasoning skills and exceptional contextual understanding, making it suitable for complex tasks such as data analysis and coding. Notably, the model is reported to be 90 to 95 percent more cost-effective than similar offerings in the market. Since its availability in late January, thousands of customers have already started deploying DeepSeek-R1 through Amazon Bedrock. AWS emphasizes the importance of integrating safety measures, such as Amazon Bedrock Guardrails, to ensure responsible usage of generative AI technology.

A new artificial intelligence system named Manus, developed by Manus AI, has been launched in China, attracting significant attention. This revolutionary agent operates independently without human oversight, performing tasks such as analyzing financial transactions and screening job candidates with remarkable speed and precision. Early users have reported mixed experiences, citing issues like error messages and inconsistent performance, despite Manus’s potential to outperform other AI tools. Co-founder and chief scientist Yichao ‘Peak’ Ji demonstrated Manus’s capabilities in Shenzhen, showcasing its ability to initiate tasks autonomously, assess new information, and adapt its strategies.

Microsoft announced an upgrade to the Think Deeper feature of its Copilot assistant, now powered by a more advanced artificial intelligence model from OpenAI. This enhancement follows the company’s recent decision to eliminate usage limits for Think Deeper, which allows the assistant to spend approximately thirty seconds on more complex inquiries. The previous model, OpenAI’s o1, has been replaced with the o3-mini high model, noted for its cost efficiency and capability to handle intricate questions. Microsoft AI CEO Mustafa Suleyman highlighted that all users can now access this improved functionality for free.

Microsoft is also intensifying its efforts to compete with OpenAI by developing its own advanced artificial intelligence models. The tech giant has created AI reasoning models similar to OpenAI’s offerings, but tensions have arisen as OpenAI has reportedly denied Microsoft’s requests for technical specifics. Additionally, Microsoft has introduced a new family of models named MAI, which aim to rival OpenAI’s technology and may be available through an application programming interface later this year. The company is also exploring alternative AI models from various firms, including xAI and Meta, to replace OpenAI technology in its Copilot product. Microsoft has invested approximately 14 billion dollars in OpenAI to date.

Anthropic launched an updated platform that enhances collaboration across teams using artificial intelligence, notably introducing features for its Claude AI assistant. The new Anthropic Console allows non-technical staff to work alongside developers on AI prompts, addressing challenges in coordinating prompt engineering. This move aims to democratize AI, making it accessible to all employees, not just technical specialists. The platform now includes extended thinking controls for deeper reasoning, balancing advanced AI capabilities with budget management. The upgraded console is available to all users immediately.

Google is introducing a new experimental feature called “AI Mode” in its Search service, aiming to enhance the way users ask complex and multi-part questions. This mode, which is rolling out to Google One AI Premium subscribers, allows users to dig deeper into topics with advanced reasoning and multimodal capabilities. According to Robby Stein, the Vice President of Product at Google Search, users are asking questions that are twice the length of traditional searches and following up with additional questions about a quarter of the time. The feature utilizes a technique called “query fan-out” to conduct multiple related searches concurrently, providing users with comprehensive responses. Google emphasizes the importance of factuality, particularly in sensitive areas like health, and warns that while the system aims to be helpful, it may still make mistakes as it continues to develop.

Why do we care?

Let’s give you some big picture reasons to care.

AI pricing wars are accelerating, making AI tools more affordable and widely used.  Lower AI costs mean greater accessibility, enabling more businesses to experiment with AI-powered data analysis and automation.

Autonomous AI agents could revolutionize workflows, but governance and security risks remain high.  Manus AI’s error messages and inconsistencies suggest that fully autonomous AI is still unreliable. If businesses over-rely on imperfect AI without oversight, it could create compliance risks, errors, and reputational damage.

Microsoft’s AI strategy is shifting, and businesses reliant on OpenAI should be prepared for future disruptions.  Microsoft’s exploration of Meta’s and xAI’s models suggests an AI model diversification and/or commoditization trend, which could give businesses more AI options in the future.

AI democratization means more non-technical users will need support, creating opportunities for IT service firms.  Businesses will need AI training, best practices, and security oversight, creating opportunities for MSPs to offer AI onboarding services.