Microsoft has started swapping OpenAI and Anthropic models out of two of its highest-traffic productivity apps, Excel and Outlook, in favor of MAI, its in-house model family. Bloomberg reported the shift on Tuesday. Tens of thousands of prompts a week inside those two apps now run on Microsoft’s own systems rather than the outside labs the company relied on more heavily until recently, according to a person with direct knowledge of the effort who requested anonymity to discuss internal matters.
The stakes are bigger than two apps. Excel and Outlook sit inside Microsoft 365, a subscription base with hundreds of millions of paid seats, and every AI-assisted formula or drafted reply run through them currently generates a bill somewhere. Moving that inference load in-house changes who collects the margin on it.
Cost is the driver. Microsoft pushes enormous token volumes through OpenAI and Anthropic today, and it has negotiated discounted rates for that scale. Those discount arrangements are set to expire soon, and Microsoft does not want to be stuck accepting whatever rate the two labs set once the current terms lapse.
Building MAI gives Microsoft an alternative to that renewal conversation. A company that can already route tens of thousands of weekly prompts through its own models arrives at the negotiating table with leverage it did not have a year ago: the credible option to route more traffic away entirely.
This is not a full exit. Microsoft remains OpenAI’s largest financial backer, and Azure still hosts frontier OpenAI and Anthropic models for enterprise customers who choose them. The Excel and Outlook shift narrows the relationship rather than ending it, moving high-volume, lower-complexity tasks such as routine formula generation and email drafting onto cheaper internal models while presumably keeping harder reasoning tasks on frontier systems from outside labs.
Bloomberg’s reporting does not say what share of total Excel and Outlook AI traffic now runs on MAI, nor whether the migration extends to other Microsoft 365 apps such as Word or Teams. Those gaps matter. A partial, cost-driven swap in two apps is a very different story from a company-wide move off third-party models, and Microsoft has not said which one this is.
The signal reaches past Microsoft’s own cost sheet. Microsoft is one of the largest single distributors of OpenAI and Anthropic capacity to enterprise customers through Azure and Copilot. A distributor that is actively building the capacity to need its suppliers less is a warning sign for how durable frontier lab pricing power actually is once discount periods end. OpenAI and Anthropic have priced enterprise API access on the assumption that large customers lack the capital or research talent to build credible substitutes. Microsoft has both, and it is using them.
Any operator running high-volume, low-complexity workloads on OpenAI or Anthropic APIs today should treat this as a preview of their own renewal conversation. If Microsoft, with its scale and discount leverage, still finds it worth building a substitute before its rates reset, smaller buyers should be testing whether a cheaper in-house or open-weight model can absorb their routine traffic before their own contracts come up for renewal.
Bloomberg reported the shift on July 7, 2026, citing a person with direct knowledge of the effort.
