Microsoft announced on Tuesday the establishment of a new AI division, with the appointment of several employees from AI startup Inflection to develop AI technologies such as Copilot. The division will be led by co-founders Mustafa Suleyman and Karén Simonyan.
Microsoft CEO Satya Nadella announced through an official blog post that the two co-founders will join Microsoft to head the newly formed Microsoft AI division, responsible for leading the development of Copilot and other consumer AI products and research. Suleyman will serve as the CEO and Executive Vice President of Microsoft AI, joining the senior leadership team and reporting directly to Nadella. Simonyan will assume the role of Chief Scientist in the division, reporting to Suleyman.
Prior to co-founding Inflection, Suleyman was involved in establishing DeepMind, now a part of Google’s AI division. Simonyan, on the other hand, contributed to the development of AlphaZero, an AI system that defeated renowned AI system AlphaGo in a chess match, during their time at DeepMind.
In addition, several Inflection employees, including AI engineers, researchers, and developers, have also joined Microsoft along with the two executives.
Inflection, an AI startup founded in 2022, raised $1.3 billion last year for the development of “more personalized AI.” Microsoft served as a major investor in the company, which is also collaborating with Nvidia to build the world’s largest AI cluster. Inflection recently announced the Inflection-2.5 AI model, touted to be comparable to GPT-4.
Nadella emphasized that Microsoft will continue to develop AI based on its collaboration with OpenAI and will further strengthen its AI infrastructure, including system and chip operations, to support the development roadmap of OpenAI’s foundational models and build products and services on top of those models. He mentioned that these efforts will be reinforced by the newly established AI division.
Meanwhile, Mikhail Parakhin, the Executive Vice President of Advertising and Web Services, along with his entire team, including Copilot, Bing, Edge, and the GenAI team, will report to Suleyman in the newly formed Microsoft AI division.
Kevin Scott, Microsoft’s Chief Technology Officer and Executive Vice President, will remain unaffected and continue to oversee AI strategy coordination, all system architecture decisions, collaboration alliances, and company-wide cooperation. Rajesh Jha, the Executive Vice President of Experiences and Devices, will continue the development of Copilot for Microsoft 365 in collaboration with the new consumer AI division.
At Inflection, Reid Hoffman, one of the three co-founders, will remain with the company to assist the newly appointed CEO, Sean White. Inflection also announced changes in senior leadership through a blog post, affirming its commitment to building personalized AI, including the chatbot Pi, while emphasizing that the company’s privacy and data policies will remain unchanged, with no data shared with third-party organizations without explicit customer consent.
Today, Inflection also announced that its Inflection 2.5 model, unveiled earlier this month, will be available on the Microsoft Azure platform and soon hosted on other cloud platforms. The company teased the upcoming release of APIs for developers and businesses to test.
The collaboration between Microsoft and Inflection comes as a significant development in the AI startup landscape following the personnel changes at OpenAI towards the end of last year. During that time, OpenAI’s CEO Sam Altman was fired by the board, and Altman and the departing CTO Greg Brockman were briefly recruited by Microsoft to lead a new AI division before returning to OpenAI. Nadella stated that Microsoft’s collaboration with OpenAI would continue. However, Microsoft has been expanding its partnerships with AI startups, including providing Databricks’ AI models on Azure.
At the same time, Microsoft faces stronger competition from Google AI. Bloomberg reported last week that Apple is in talks to use Google’s Gemini or OpenAI’s ChatGPT as the underlying AI functionality for iPhones. Apple’s 2.2 billion iPhones would be a significant boost for any AI chatbot in terms of market share.