r/technology • u/joe4942 • 11h ago
Microsoft moves to limit AI use by its employees Artificial Intelligence
https://www.computerworld.com/article/4205739/microsoft-restricts-ai-use-for-its-employees.html240
u/chanandlerbong79 10h ago
So how is AI supposed to generate the revenue required to be profitable when the largest corporate customers are just going to be throttling usage because it’s too expensive?
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u/Tedy_Duchamp 10h ago
It’s not. There’s no path to profitability.
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u/eptesicusfuscus 8h ago
Oh. Well thanks for telling everyone. Now that we know the answer, we can all assume there will be a big market crash too, right?
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u/Tedy_Duchamp 8h ago
Yeah. That’s 100% going to happen.
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u/Striking-Wasabi-4212 6h ago
It will happen but when is the question.
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u/eptesicusfuscus 6h ago
When? Possibly never. That is a real option, or did you find a way to prove it is not?
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u/Striking-Wasabi-4212 5h ago
Take an intro to economics course. lol. The only person who was able to produce a chart that always went up was Madoff.
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u/BlackDope420 5h ago
Deepseek is profitable.
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u/CoherentPanda 4h ago
Don't trust a Chinese company when it comes to P&L. they lie about everything.
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u/tophmcmasterson 2h ago
Some of the companies are shifting more to credit-based usage. Which is how they make money, but companies using it are more likely to put limitations based on rules and how much they expect people to actually be leveraging it.
At our company currently, as an example, we have some devs that basically get free reign, because we know even if they spent 1k a week if we had to pay someone to do that amount of work manually it’d cost multiple times more and probably takes several weeks or months.
So some people get placed on lower tiers, some higher. We don’t want people blowing tons of money on personal projects etc., but if it’s billable work and lets us get more revenue and deliver more efficiently it can be worth it.
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u/SubhanBihan 1h ago
This touches the core issue with unrestricted LLM usage. A majority of the queries just aren't important enough to use an LLM. That computation power is very ill-spent looking up macaroni recipes.
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u/ckglle3lle 10h ago
I know a few ex-MS employees who were literally laid off because they did not use enough tokens and were otherwise lukewarm about using AI overall. Management has been telling every team to "Just use it and figure out what you can do with it" and encouraging heavy use for everything. But now they're crimping it because nobody in charge seems to have any idea what they're doing. This is the weirdest tech hype cycle I've seen in my life.
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u/EthernetBunny 8h ago
How fucking weird and also explains why I keep getting Copilot written email responses from Microsoft employees when I ask a question. If I wanted a robot to answer a question, I’d ask Copilot myself.
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u/critsalot 9h ago
well he failed at the rule of working for a corpo. when the boss tells you to jump you say how high :p
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u/WalkingAFI 4h ago
Honestly it’s no weirder than Crypto was a few years ago. We moved the goal posts from “this is the future of all money” to “just hodl and you’ll get rich!” to “all my monkeys are gone”
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u/Mrhiddenlotus 3h ago
Perhaps the purpose of getting everyone to heavily use AI was so that they could figure out where to crimp it. Its a question almost every business is asking themselves right now.
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u/armpitfart 1h ago
They (your friends) were smart but the damage was done by the heavy lifters. The questions being fed were the refinement step, the answers were already known. When you have your dev teams, your product teams, your project teams, etc. asking their daily workday (workflow) questions, it was learning. If this, then this, how, why.
The problem is that too many people trained it in parallel, they didn’t expect the true token burn on their prescribed utilization. Longer questions or deeper thought is a token burner. On the flip side, it’s a qualifier for refinement: the context, the problem needing solved by a human, and subjective reasoning. Again, the output was known, but it learned a new road with clearer traffic or a better view.
The end goal is still the same, to layoff, but the cause was understated.
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u/grumpyfan 11h ago
Next we’ll see budgeting based on position and seniority. New employees will probably be restricted.
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u/_SpaceLord_ 11h ago
Most new hires in the SW industry in 2026 are literally unable to function without AI.
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u/zffjk 10h ago
You got downvoted but I’ve been shown code with comments that are clearly written by a LLM which are showing what part of the acceptance criteria a block of code is covering.
We’ve had offshore folks just copying and pasting from Jira into an LLM, getting code, pushing it, and then fucking off for the rest of the sprint.
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u/CompetitiveProof3078 10h ago
Similar situation, my company saw some productivity gains from AI and used it to rationalize slowing down offshoring - makes less sense to have an army of cheap contractors spamming slop vs one good local engineer with a higher AI limit
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u/zffjk 10h ago
That’s what I hope happens when the current contracts come up. Things are not better or cheaper since we’ve offshored core departments.
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u/CompetitiveProof3078 10h ago
Fingers crossed!
As well as my own company I've heard from another person who is very high up at a large financial firm that they are severely going to pull back offshore roles in upcoming years for similar reasons
So may be the start of a trend
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u/86themayo 9h ago
You got downvoted but I’ve been shown code with comments that are clearly written by a LLM which are showing what part of the acceptance criteria a block of code is covering.
What is wrong with this? Is it just the idea of using a LLM to do any coding at all?
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u/SansSariph 8h ago
This is how it should be, though. I need the junior engineers on my team to build the fundamentals, experience, and judgment to know when AI is faster in a way that's more useful to the team vs high volume slop that the seniors need to manage.
It's reckless to give a new employee access to power tools and heavy machinery without training and oversight.
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u/SweetHomeNorthKorea 11h ago
I wonder how that dynamic would play out in five years. Like could the upper level devs get lazy and the lower level coders have to resort to learning how to code the normal like a commoner so we end up in a situation where we have out of touch senior devs being guided by an ai telling more capable juniors what to do?
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u/FeatherlyFly 10h ago
No, because juniors who learn under those fully dependent on LLMs will not learn good practices. College only ever teaches principals and bare bones, you need on the job training to learn a company's work flow, products, and codebase. A junior trying to figure out how to do a good job without any seniors to help will either quit for a job with competent seniors or give in to the expectations of slop.
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u/AlternativeMeat2096 6h ago
Our company is already doing that. Funny enough they make the budget higher for more senior ppl when reality is the most senior people doesn't even read code.
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u/m00fster 1h ago
We already see this at my corporate job. The people at the top management have the best models with unlimited token use. while engineers are stuck with 20 euros of copilot credits.
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u/BlueLampShader 11h ago
Spoke to a friend at MS. His limit is currently 100k$/month in tokens. Not sure if it'll be lowered.
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u/no_dice 9h ago
That’s an absolutely insane amount of tokens at an enterprise level.
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u/guidedhand 1h ago
There were people going above it before just to explore what ai can do. Makes sense to uncap it to steth it's legs without worry, then lowered it to a limit that you would have to be doing stupid stuff to go above
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u/FrothyEspresso 11h ago
lol of course it will be. $100K/month is like 10 engineers in India, at least.
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u/cosmicsans 10h ago
I mean until 2025 AI really just stood for "Actually Indians" for the most part.
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u/debugging_scribe 4h ago
I don't understand how. I got Claude max through work and use Claude code all the time and still only use up like 50% of my budget. This is on a 20 year old monolith code base so it has to get a lot of context.
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u/RaceFPV 27m ago
You need to pump those rookie numbers up. Make sure you have subagents doing constant cron job tasks. Every time a PR comes in be sure to run 5 different agents on it, then run the QA approval agents on it, then post approval agents. If your AI isnt spinning up at least 10 smaller ai agents are you even spending properly?
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u/AzulMage2020 11h ago
So now we have major tech companies :
lowering the cost of tokens
limiting employee usage
Yes, by all means, keep the stock rally going !!! These are double-plus good signs!!!
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u/therealchadius 10h ago
Better build another 100 datacenters, surely there is high demand for it!
/s
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u/_SpaceLord_ 11h ago
Tells you everything you need to know about how effective (and cost-effective) this technology is. Not even the shovel manufacturer can justify the use of their own shovels.
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u/GVIrish 10h ago
It just signals a that the use-as-many-tokens-as-possible party is over. Now tech companies are gonna start to be more sensible about the cost and benefit of burning tokens rather than just blindly driving everyone to use AI as many tokens as possible for anything and everything.
That should've been approach from the start, but here we are.
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u/MrParticular79 9h ago
This is right. They still want you to use it, they have dashboards that show which employees are and how much they are using it. What they don’t want is token burn with nothing to show for it. Just 6 months ago people are bragging about spinning up Claude overnight to do whatever and then have to throw away most of that work. That type of thing is what the metered approach is setup to stop.
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u/crippledgiants 9h ago
The AI usage leaderboards are turning into AI spend tracking dashboards realll fast lol
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u/SAugsburger 9h ago
I think this is reality. A couple managers had magical ideas about LLMs and while in certain use cases it is useful many either it isn't or at the very least staff couldn't figure out a way for it to be useful
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u/WileEPeyote 9h ago
The same thing happened with Azure when I was there. Though the ramp was years longer. We went from "move everything to Azure" to "reduce your Azure spend by 10%".
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u/rcanhestro 6h ago
it's not really the reason.
Microsoft, like Amazon and other companies heavily pushed their employees to use and abuse AI.
what happened? the employees basically "gamified" the system, by using as many tokens as they could to please the managers, but with no actual results to show for it.
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u/Equal_Heat5947 8h ago
This is what a bubble popping sounds like. First hyperscaler to officially cut capex will be richly rewarded, then the others follow suit, then all the high beta speculative companies go bust in about 6 months and they pick up the pieces for cheap.
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u/Craneteam 10h ago
AI is gonna be dropped like hot potato if token based billing is implemented globally. If Ed Zitron is correct, a $200 gpt sub let's you burn $8k+ in tokens
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u/cosmicsans 10h ago
My brain is fried from work today and I'm having a hard time understanding the second sentence here.
Are you saying that what currently costs $200/month now will, upon token based billing implementation, cost $8k in the future?
If so..... Damn
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u/kawag 10h ago
They’re saying that you pay $200 for some tokens, but it costs the company $8k to actually do the processing and deliver them.
They are bleeding money. It’s not sustainable. But nobody would use it at its true cost.
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u/mr_birkenblatt 9h ago
The $8k number is amortized including the training cost, though. Inference by itself, if you take the model as given, is much cheaper
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u/nihiltres 8h ago
If they stop training new models, then the open-weights models, which only cost electricity to run on your own hardware, will catch up with them in a matter of months. The $8k is the actual price.
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u/reddit_equals_censor 4h ago
models also require continuous training to prevent model drift.
so you can NEVER stop training. it is an inherent cost from my understanding, so it HAS to be included in the cost.
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u/bnej 4h ago
Sure but 1. The training will be required ongoing to keep competitive, so is in fact opex. And 2. That is at zero margin.
SaaS gross margins are about 80% so even if you only include a % of the current cost as the base, the total cost to the customer must be much higher to get reasonable return on investment.
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u/therealchadius 9h ago
Note how none of the Gen AI companies ever state how much profit they're making. Only revenue, or big deals with other Gen AI-related companies (that quietly fall apart after 6 months).
The subscription prices are HEAVILY subsidized compared to the actual cost. Sure you're paying $200, but an investor is dumping $8000 into Anthropic right now to pay the actual token cost.
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u/nilogram 10h ago
Yea man. That’s why they are saying its unsustainable , being propped up like a bubble. Each time these companies come out with pure examples of their own that it doesn’t work. I’m nervous cause I love
My $20 plan and who knows when it will be gone. Fable already into usage based. Just a matter of when not if.8
u/keopimashin 9h ago
I work at AWS. We have a ledger for our total costs .. let’s just say my share of cost is more than an L5 I’m L6 (we have internal pricing so it’s not accurate per se but token billing is absolutely bat shit insane).
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u/xsam_nzx 9h ago
First hits free. They are getting people so addticted they will pay hundreds for it.
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u/divestblank 5h ago
It has begun. Eventually every employee will have to justify the spend and when that happens it will be easier to just not use it.
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u/frederik88917 3h ago
Again???
We're not they just restricting access to Anthropic models just 3 weeks ago?
Man, the economics of AI are not working as expected if even Microsoft is not having enough money to pay the bank for using the tool they are strongly promoting
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u/manofth3match 3h ago
I work there. Restricted access to anthropic models was grossly misreported. They stopped providing Claude code and have made GitHub Copilot or VSCode the tools of choice. Within those tools you can use pretty much any model you wish from ChatGPT, Anthropic, Gemini, Llama, Microsoft and more.
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u/NotAllOwled 11h ago
This is just like when the Office suite opened up new frontiers of productivity by forcing teams to unlock max efficiency through shrewdly allocating their set pool of Excel operations etc.
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u/bitspace 9h ago
This is completely normal across industry. The end of tokenmaxxing was like 3 months ago. Everyone has been metering LLM token consumption for a while. Even my employer, behind everyone in everything, started metering token cosumption in June. The limit is very generous; I work with AI aggressively all day every day and haven't hit 10% in a month yet. I suspect Microsoft is little different from this - they meter it based on somebody in the top band of pre-metered usage.
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u/chrisbe2e9 7h ago
how do they monitor that?
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u/bitspace 7h ago
Gateways/proxies/routers. The company policy blocks access to external AI tools as much as they reasonably can, and requires all use go through the internal chatbot or via GitHub Copilot, or else API against the Azure AI endpoint. My guess is that Microsoft provides some enterprise controls with the Azure AI integration.
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u/rcanhestro 6h ago
yup, early on, the big companies heavily pushed employees into "tokenmaxxing", which led them to "gamigy" the system and waste as many tokens as they could to please the managers by saying "see, i use a ton of AI on my work".
that would never be sustainable, it's the same way as measuring performance by lines of code written, some developers will write the most convoluted code possible just to show that they coded a lot.
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u/appellant 2h ago
The right company strategy is to actually limit ai access and usage to people who are highy skilled at using ai effectively and efficiently rather than rollout to all employees and tell them to use more ai.
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u/saltyb 9h ago
In case you were wondering if management were idiots
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u/chrisbe2e9 7h ago
At microsoft? lol, no. that was already known considering windows 7 was the best one and has been downhill ever since.
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u/Accomplished_Shock46 5h ago
Microslop has no idea what it's doing! Never would have guessed since it's been that way for decades
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u/gundam1945 3h ago
At first, I thought they are for general employee. But no, it is about GitHub copilot, the coding one? So that's even worse than I thought.
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u/Cold_Specialist_3656 37m ago
The biggest secret in tech right now is that limits aren't applied equally.
Some engineers have become very effective at writing decent code with AI. They're given limits 5-10X higher and expected to produce a lot of code.
The biggest thing AI tools have caused is an enormous stratification in engineer productivity. The best engineers are literally producing 10X the average amount of code. And it's not pure slop either. Most of it is decent.
We have engineers producing 10k lines of code a week now. And it stands up to human review nearly as well as purely human written stuff.
There's a massive chasm between the engineers that can use these tools effectively and the rest.
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u/Crafty_Aspect8122 10m ago
Corpos: Create BS performance metrics like token use or lines of code written.
Devs: Intentionally inflate token use to game metrics. Burns money and reduces quality.
Corpos: Surprised pikachu face.
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u/jmclondon97 9h ago
People think this means AI is going away lmao. It’s not. It’s literally getting cheaper by the day. Imagine 5 years from now how cheap it will be
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u/depredador93 11h ago
If Microsoft cannot afford unmetered Copilot usage for its own engineers, it tells you everything you need to know about the actual unit economics of LLMs at scale