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Home DisruptiveTECH

Microsoft Build 2025: New AI Strategy, Cuts Data Centre Expansion, Repositions OpenAI Partnership

by Joan Aimuengheuwa
May 19, 2025
in DisruptiveTECH
1
Microsoft Build 2025: New AI Strategy, Cuts Data Centre Expansion, Repositions OpenAI Partnership
Source: Microsoft

Source: Microsoft

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Microsoft began its annual Build conference today in Seattle with innovations to enhance AI infrastructure, rewrite old partnerships, and sharpen its focus on profitability.

This year alone, Microsoft has sunk $64 billion into infrastructure, much of it driving the AI growth through data centres powering services like Copilot in Microsoft 365. 

While most tech firms are cautiously navigating unstable markets, Microsoft’s share price has surged over 30%, a sign investors are betting on the company’s aggressive AI focus.

Behind the scenes, Microsoft appears to be recalibrating its alliance with OpenAI. Though the two remain close, with Microsoft still a strategic backer, OpenAI has been given leeway to partner with others, including Oracle, on the massive Stargate data centre project in Texas.

What’s happening is Microsoft is gradually placing itself as a neutral technology provider, what some are calling an “arms dealer” in the AI wars, rather than locking into exclusive alliances. This neutrality allows it to offer AI tools across industries without being boxed in by one partner’s limitations or priorities.

Meanwhile, demand for AI services in Azure, Microsoft’s cloud platform, is climbing. CEO Satya Nadella has suggested that AI costs can be drastically reduced through algorithmic efficiency. “Once it settles on an algorithm and begins to optimise it, Microsoft can obtain 10 times better performance for the same computing costs,” he said. That’s the kind of return that could redefine tech margins.

The company is also being tactical about how it handles computational surges. Instead of building more expensive data centres, Microsoft is leaning on “neocloud” providers like CoreWeave. These firms specialise in delivering Nvidia-powered AI infrastructure on demand. It’s a leaner, faster, more flexible approach to scaling.

Cantor Fitzgerald analyst Thomas Blakey said: “If they have to flex up in some way, they’ve been consistently saying that they’re going to shift away from buying more data centres and dirt and cement and they’re going to leave that to the neoclouds.”

The Microsoft Build 2025 conference, running until May 22, is not just a developer gathering this year. It’s a moment of clarity about Microsoft’s vision to take over the AI stack, monetise it, and use every tool, from GitHub to Azure, to keep developers building inside its ecosystem.

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Tags: AI infrastructureAI strategyAzureCopilotCoreWeavedata centresMicrosoft Build 2025OpenAISatya NadellaTech conference
Joan Aimuengheuwa

Joan Aimuengheuwa

Joan thrives at helping individuals and businesses scale via storytelling...

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  1. Pingback: Microsoft to Scrap App Store Onboarding Fees from June 2025 - Inventrium Magazine

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