Microsoft Chairman and CEO Satya Nadella speaks to attendees at the Microsoft Build conference in Seattle on May 23, 2023.

Dan Delong | Microsoft

If there’s one company that has popularized artificial intelligence in the past year, it’s small but well-funded startup OpenAI, the organization behind the viral chatbot ChatGPT.

This week at the Build conference for software developers, Microsoft made extensive use of cooperation with a startup in which he invested billions.

At the center of Tuesday’s first day of the show was an onstage conversation between Greg Brockman, co-founder and president of OpenAI, and Kevin Scott, Microsoft’s chief technology officer and the man credited with creating the unusually close relationship between the two companies.

“You heard it from Greg,” Scott told the crowd gathered at the Seattle Convention Center in Washington, D.C., at the end of the talk. “All of you will make AI great.”

To that end, Microsoft has announced a number of developer products that rely on OpenAI technology:

  • New Azure cloud tools for personalized text summarization are available.
  • The future chatbot promises to help developers work with data and prepare it for analysis.
  • Developers will be able to build plugins that run on ChatGPT and chatbots in Microsoft’s own products, including one that debuts on Windows next month.
  • Developers who receive coding suggestions through the GitHub Copilot feature will have access to a chatbot inside the Windows Terminal command-line program.

Generative AI will change software forever, says Nadella

OpenAI released ChatGPT to the wider world in November, to great consumer interest. Soon after, companies like Atlasian, Morgan Stanley and Sales department hastened to demonstrate the integration of the large OpenAI GPT-4 language model that powers the chatbot. GPT-4 and similar alternatives Amazon and Google have been trained on vast sets of internet data and become capable of spitting out chunks of text that sound natural.

This is a popular form of what has come to be called generative artificial intelligence, which can take human input and respond to a computer-generated output.

“Every level of the software stack will be changed forever, and there’s no better place to start than the actual development stack,” Microsoft CEO Satya Nadella said during his Build keynote on Tuesday. “We, as developers, are fundamentally changing the way we build.”

It’s important for third-party developers to continue to enrich Microsoft’s proprietary software properties, such as the Microsoft 365 productivity software suite. Such work can help the Microsoft Teams communications app, for example, become a more obvious hub for an ever-widening selection of processes and tasks that companies need to to perform This could make it less likely that companies will switch to alternatives like Google Workspace.

On Tuesday, Microsoft singled out dozens of plug-in developers, including Adobe, AsanaCanva, Cloudflare, Krasnoperka, Spotify and TripAdvisor. The demo showed the Windows chatbot turning on a Spotify playlist, creating a company logo using Adobe Express, and sending the logo to a human’s colleagues via Teams in response to a series of typed messages.

Greg Brockman, president and co-founder of OpenAI, and Kevin Scott, chief technology officer of Microsoft, speak on stage at the Microsoft Build conference in Seattle on May 23, 2023.

Dan Delong | Microsoft

At the same time, Nadella has pushed for Microsoft to include GPT-4 directly in Teams and older Microsoft products like the Bing search engine, often leading to bots called Copilot. The term Copilot emphasizes human collaboration, as opposed to (for example) the advanced driver assistance system Autopilot for Tesla vehicles.

“We’re adding Copilot to everything,” Scott Guthrie, executive vice president of Microsoft’s cloud and AI group, told CNBC last week. “It’s less of a top-down mandate, although we’re definitely pushing for a top-down one.” I think that’s something that we’ve really preached internally and really excited every team. And we’re building a common stack for Microsoft that the whole company is building on top of.”

Analysts have responded favorably to the onslaught of developers.

“The pace of MSFT’s GenAI innovation remains stunning for us,” Mizuho analysts wrote in a note to clients on Wednesday with a buy rating on Microsoft shares.

Brockman hinted to developers that the cost of GPT-4 running on Azure could come down.

“I think we cut our prices by 70% two years ago,” he told Scott. “In fact, we cut costs by 90% last year. A 10x cost reduction is like crazy, right? And I think we will be able to do the same with the new models. And so GPT -4 now, it’s expensive, it’s not fully available. But that’s one of the things that I think will change.”

WATCH: Microsoft Build 2023 introduces plugins and products that include artificial intelligence

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