Microsoft starts pulling OpenAI and Anthropic out of Excel and Outlook

In-house models take over everyday tasks

Microsoft, looking to reduce AI costs, is starting to replace OpenAI and Anthropic with its own models in software products like Excel and Outlook. Tens of thousands of AI prompts in the widely used spreadsheet and email applications are now being completed each week with Microsoft's internally built MAI models, according to a person familiar with the work.

While still accounting for a small share of overall AI usage, the move shows Microsoft is making progress in its efforts to build competitive artificial intelligence models at a lower cost. The logic is straightforward: handle routine, high-volume tasks cheaply in-house, and reserve third-party frontier models for work that genuinely requires them.

In June, AI model chief Mustafa Suleyman said the company was trying to reduce spending on Anthropic by using more MAI models. He was blunt about the motivation. "We pay a lot of money to Anthropic, so our goal is to reduce and ultimately eliminate that cost," Suleyman said at the time.

A complicated relationship, not a clean break

The shift is a strategic recalibration rather than a full divorce. Microsoft's flagship Copilot agent still runs on @OpenAI and @AnthropicAI models for demanding tasks. The clock is ticking on that arrangement, and Suleyman's team is working to make sure Microsoft is not left paying whatever the leading AI labs decide to charge.

Microsoft has invested $13 billion in OpenAI and $5 billion in Anthropic, while making their models available through Azure. That financial entanglement makes the pivot delicate. The company retains a roughly 27% stake in OpenAI, meaning it has a direct interest in preserving the relationship even as it engineers a way around it.

The timing adds another layer of complexity. Anthropic filed confidentially for an initial public offering on 1 June, just days after raising $65 billion in a Series H funding round that pushed its valuation to $965 billion. OpenAI is also readying its own confidential filing. A Microsoft that relies less on both companies for routine workloads raises an obvious question: does a diminished dependency dent the valuation story as each heads toward the public market?

Microsoft, for its part, is pushing further into proprietary AI. The company announced seven new AI models at its annual Build conference for developers in June, including one it says can match the coding abilities of a prior-generation Anthropic model at a reduced cost. Within Microsoft, the company uses its MAI models for Excel-specific agentic use cases, with its MAI tuned model described as comparable to GPT 5.4 on public and private benchmarks, while being up to ten times more efficient.

Sources:
Bloomberg: Microsoft Replaces OpenAI, Anthropic With Own AI in Some Apps
CNBC: Microsoft unveils new AI models to lessen reliance on OpenAI
Euronews: Microsoft launches its own AI models to take on OpenAI and Anthropic