Microsoft joins AI cost-cutting trend by relying more on its own models

# Microsoft joins AI cost-cutting trend by relying more on its own models | TechCrunch Source: [https://techcrunch.com/2026/07/07/microsoft-joins-ai-cost-cutting-trend-by-relying-more-on-its-own-models/](https://techcrunch.com/2026/07/07/microsoft-joins-ai-cost-cutting-trend-by-relying-more-on-its-own-models/) In Brief Posted: 12:58 PM PDT · July 7, 2026 **Image Credits:**JASON REDMOND/AFP / Getty ImagesAs[AI costs continue to rise](https://www.barrons.com/articles/ai-spending-alphabet-amazon-meta-b22f1044), companies are looking for ways to cut back\. The most recent example is Microsoft, which has reportedly begun to deploy a cost\-savings strategy by relying less on software from OpenAI and Anthropic and instead deploying its own in\-house models\. Indeed, when it comes to two of its most widely used programs — Excel and Word — Microsoft has begun to use its homemade[MAI models](https://github.blog/changelog/2026-06-26-mai-code-1-flash-for-copilot-business-and-copilot-enterprise/)to respond to a certain percentage of user prompts, Bloomberg[reported](https://www.bloomberg.com/news/articles/2026-07-07/microsoft-replaces-openai-anthropic-with-own-ai-in-some-apps)Tuesday\. In the past, the company had advertised the fact that large parts of Office 365 are[powered by models from both OpenAI and Anthropic](https://www.microsoft.com/en-us/microsoft-365/blog/2025/09/29/vibe-working-introducing-agent-mode-and-office-agent-in-microsoft-365-copilot/)\. While Microsoft still relies on those third\-party models, it has also increasingly sought to stand up its own AI agents\. Last month, at its annual Build conference, the company announced the[launch of seven new MAI models](https://microsoft.ai/news/building-a-hillclimbing-machine-launching-seven-new-mai-models/), including an agentic coder and a text\-to\-image generator\. When reached for comment by TechCrunch, Microsoft said that it had nothing further to share\. Microsoft’s apparent cutbacks are part of a broader trend\. After a brief blitz of “tokenmaxxing” earlier this year, the last few months have seen a news cycle awash in stories about tech companies acting significantly more thrifty\. Other large companies — like[Amazon](https://www.nytimes.com/2026/06/18/technology/ai-token-minimizing.html),[Uber](https://techcrunch.com/?p=3128791&preview=true&_thumbnail_id=3100056),[Meta](https://www.theinformation.com/articles/tokenminimizing-meta-moves-curb-employee-ai-usage-ai-costs-reach-billions), and[Accenture](https://techcrunch.com/2026/06/24/companies-are-scrambling-to-stop-employees-from-maxing-out-ai-budgets-with-small-tasks/)— have also reportedly made moves to curb spending\. The immense cost of providing and buying AI services has become a controversial part of the industry\. The sticker shock has gotten so bad in some parts of Silicon Valley that some companies[are reportedly](https://www.theatlantic.com/technology/2026/07/glm-5-2-china-cheap-ai-agents/687828/)looking to Chinese models for more affordable agentic solutions — despite some concerns over[potential security issues](https://www.washingtonpost.com/national-security/2026/07/06/why-anthropic-alleges-chinese-firms-are-distilling-knowledge-claude/)\. ### Newsletters Subscribe for the industry’s biggest tech news ## Related ## Latest in AI