Microsoft strikes AI deal with Anthropic, eases reliance on OpenAI
The move means that Anthropic's cutting-edge model, Claude Sonnet 4, will soon power features in Word, Excel, Outlook, and PowerPoint - ending Microsoft's exclusive reliance on OpenAI's technology for its productivity suite.
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Microsoft is expanding its artificial intelligence ecosystem by striking a deal with Anthropic to brings its AI models into Office 365 applications, according to a report by The Information.
The move means that Anthropic's cutting-edge model, Claude Sonnet 4, will soon power features in Word, Excel, Outlook, and PowerPoint - ending Microsoft's exclusive reliance on OpenAI's technology for its productivity suite.
The timing of the deal is significant. Microsoft's relationship with OpenAI has come under strain as the latter develops its own infrastructure and ventures into areas that directly compete with Microsoft, including a LinkedIn rival and plans to mass-produce AI chips with Broadcom by 2026.
While Microsoft is negotiating a new agreement with OpenAI following its for-profit restructuring, sources told The Information that the Anthropic deal is not just a bargaining tactic.
Exclusives at Microsoft reportedly believe Anthropic's models outperform OpenAI's in certain areas, such as generating visually compelling PowerPoint presentations.
This diversification strategy isn't new. Microsoft has already integrated alternative AI systems like xAI's Grok and Anthropic's Claude into GitHub Copilot, while also investing in self-reliance by unveiling its first in-house AI models, MAI-Voice-1 and MAI-1-preview.
OpenAI, for its part, is moving to reduce dependency on Microsoft's Azure Cloud infrastructure. Its reported plans to design and manufacture AI chips signal a push for greater control over its operations.
Despite tensions, Microsoft insists its long-term alliance with OpenAI remains intact. "As we've said, OpenAI will continue to be our partner on frontier models and we remain committed to our long-term partnership," Microsoft spokesperson Michael Collins told TechCrunch.
