Microsoft is building its own AI model

Microsoft $MSFT wants out of the “powered by someone else” business. The company’s AI chief, Mustafa Suleyman, told the Financial Times that the company is pushing toward AI “self-sufficiency.” That means developing its own advanced foundation models and continuing to reduce its reliance on OpenAI, even as the two companies keep their relationship intact.

Microsoft’s October 2025 reset with OpenAI preserved the core perks: Microsoft says OpenAI remains its “frontier model partner,” and Microsoft’s IP rights and Azure API exclusivity run “through 2032,” including models “post-AGI.” So this is Microsoft buying itself even more room to negotiate, route, and replace. 

Because when your flagship AI product sits inside Microsoft 365, “single supplier” starts sounding like a vulnerability you have to try to explain on earnings calls. Microsoft can keep selling “Copilot everywhere,” but the real prize is making sure the underlying compute, security, and…