Microsoft employees once had monthly AI budgets of $100,000 each in its cloud and AI group

Microsoft official logo (public domain, Wikimedia Commons) — CryptoBriefing brand treatment Microsoft has reportedly reduced its internal AI budgets from $100,000 to around $10,000 per employee within its Cloud and AI organization. This significant budget cut is accompanied by a strategic shift away from Anthropic’s AI models, such as Claude, in favor of alternatives from OpenAI and Microsoft’s own models. The decision appears to be driven by a combination of cost management and performance considerations. Despite this internal pivot, Anthropic’s models continue to be available on Microsoft’s Foundry and customer-facing Copilot products, indicating an ongoing, albeit adjusted, partnership. Key Takeaways Microsoft’s reduction in AI budgets appears consistent with a shift in confidence towards non-Anthropic models, likely affecting Anthropic’s perceived competitiveness. Market pricing suggests a decrease in the likelihood of Anthropic models maintaining top positions by the end of October 2026. Anthropic’s Claude models still rank highly on LMArena, suggesting ongoing competitiveness despite Microsoft’s internal changes. What to Watch Markets will be closely observing the impact of M...