Microsoft is standing at a crossroads. Its CEO, Satya Nadella, has warned that artificial intelligence could make some of the company’s biggest businesses irrelevant.
Speaking at a closed-door town hall, Nadella said he is “haunted” by the fall of Digital Equipment Corporation. “Some of the biggest businesses we’ve built might not be as relevant going forward,” he told staff.
The tech giant has already cut over 15,000 jobs this year. Workers say they feel anxious and boxed in, as AI takes centre stage.
A Shift That Feels Like a Storm
Microsoft is pouring billions into AI. It has pledged $80 billion to expand data centres, outpacing rivals like Google and Meta.
The company is embedding generative AI into Windows, Office, and Azure. But the cost is steep—jobs are vanishing, and culture is changing.
“All the categories that we may have even loved for 40 years may not matter,” Nadella said. “We must build what’s secular… not cling to the past.”
Elon Musk added fuel to the fire. He said it’s “possible to simulate Microsoft entirely with AI,” raising questions about the future of software.
Microsoft’s partnership with OpenAI remains strong, though tensions are rising. The two firms signed a “non-binding memorandum of understanding” this month.
The Race to Reinvent
Other tech giants are not sitting still. Meta has slowed hiring but increased spending on AI infrastructure.
Microsoft’s Responsible AI Transparency Report shows efforts to govern AI safely, even as it races to dominate the space.
The company is also testing new cooling systems for its data centres, aiming to reduce energy use and improve efficiency.
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