Microsoft's Gen AI Playbook
Microsoft is using AI to sell the broader suite and the broader suite to sell AI
The full extent of just how well Microsoft is playing the Generative AI trend became apparent to me today after chatting with a large enterprise about their buying decision in the space.
Enterprises that want to use OpenAI models securely across their org have 2 options: (1) go directly to OpenAI or (2) get Azure OpenAI, and the second option is set up to be ✨ incredibly compelling ✨ because:
🔐 Security - Customers get the security capabilities of Microsoft Azure like private networking, regional availability, and responsible AI content filtering while running the same models as OpenAI. This week, Microsoft announced 'Private ChatGPT' as a free Azure app with built-in guarantees around the privacy of your data, fully isolated from those operated by OpenAI (though very mysteriously the GitHub repo now shows a 404 error). OpenAI's trust problem is Microsoft's window of opportunity with enterprises.
👨✈️ Co-Pilots - Customers can plug into Microsoft's ecosystem of Co-Pilots across all their services. This is a super compelling value prop because for the many companies that are Microsoft shops, their employees and data both already live on the platform and the benefits are immediate.
💰 Savings - Substantial economic benefit from having an all-in-one contract with Microsoft. Many customers that are already Microsoft shops simply have to toggle on these services at favorable pricing. There is no buying decision to be made given the massive delta in convenience and cost Microsoft offers!
Microsoft is using AI to sell the broader suite and the broader suite to sell AI very very effectively. 🔄 It is clear that incumbents are best positioned to benefit from GenAI because they already control the data and the distribution - and there is no better case study in this than Microsoft. Their investment into OpenAI may just be the best $13B ever spent! 💸