Daijiworld Media Network - Redmond
Redmond, Feb 4: Microsoft’s Copilot chatbot has become a key pillar of the company’s artificial intelligence strategy as its once-close partnership with OpenAI gradually diminishes, but the effort to position Copilot as a serious alternative to ChatGPT has faced major hurdles, according to reports.
Current and former employees working on Microsoft’s AI products said confusing brand positioning and interoperability issues have left many users frustrated. Data reviewed by the Wall Street Journal reportedly shows that only a small proportion of enterprise subscribers are actively using Copilot, and the share of users preferring it over rivals such as Google’s Gemini and other AI tools has declined in recent months.
The stakes are high for Microsoft, as Copilot is central to CEO Satya Nadella’s ambition to transform the company into an “AI-first” powerhouse, similar to how he drove Microsoft’s shift to becoming “cloud-first” nearly a decade ago. Executives cited Copilot as one of Nadella’s top priorities.
Microsoft’s stock recently came under pressure after its earnings report raised investor concerns about slowing growth in its crucial Azure cloud-computing business, and the company’s dependence on OpenAI even as Copilot’s long-term success remains uncertain. Shares dipped further amid broader market worries that AI tools could reduce the need for traditional enterprise software subscriptions.
In a December blog post, Nadella said the AI industry was moving beyond the “initial phase of discovery” and entering a period where the difference between “spectacle” and “substance” would become clearer.
Despite lagging in the chatbot race so far, Microsoft continues to generate billions of dollars from AI-driven demand for cloud services, keeping it among the world’s most valuable companies. Analysts believe the tech giant still has a strong chance to close the gap, especially as its productivity tools remain deeply embedded across global corporate workplaces, offering Microsoft a massive user base to push new AI offerings.