The cost of new AI models can add up quickly. A new “o3” model from OpenAI costs $20 per task. Why Microsoft is paying close attention to the price.

Microsoft has been working on adding internal and third-party artificial intelligence models to power its flagship AI product Microsoft 365 Copilot, in a bid to diversify from the current underlying technology from OpenAI and reduce costs,

The effort is said to focus on the tech giant’s Microsoft 365 Copilot product. It’s an artificial intelligence assistant that ships with the eponymous productivity suite. Microsoft is reportedly working to integrate custom and open-source artificial intelligence models into the assistant, which is currently powered by technology from OpenAI.

Microsoft is planning to integrate internal and third-party artificial intelligence (AI) models into its flagship AI assistant, Microsoft 365 Copilot. The move comes as the tech giant looks to reduce its dependence on OpenAI 's tech and save costs.

When Microsoft announced 365 Copilot in March 2023, a major selling point was that it used OpenAI's GPT-4 model. Microsoft is also seeking to reduce 365 Copilot's reliance on OpenAI due to concerns about cost and speed for enterprise users, according to the sources, who requested anonymity to discuss private matters.

AI founders and investors told TechCrunch that we’re now in the “second era of scaling laws,” noting how established methods of improving AI models were showing diminishing returns. One promising new method they suggested could keep gains was “test-time scaling,

See all the announcements from OpenAI’s 12-day extravaganza, including new integrations for developers and an opportunity to stress-test the next big model.

OpenAI announced the release of a new family of AI models, dubbed o3. The company claims the new products are more advanced than its previous models, including o1. The advancements, according to the startup,