Microsoft joins the AI race with its own model, aiming to compete at "very low prices"

Microsoft unveiled its own AI models at Build, including MAI-Code-1-Flash for generating app and website code from text and MAI-Thinking-1, a lower-cost reasoning model.

The new models will be used in GitHub Copilot, Visual Studio Code, and Microsoft Foundry, signaling a broader push across Microsoft’s developer and enterprise stack.

Microsoft says the models are more cost-efficient than previous options and also introduced voice, image-generation, and a small Aion model for Windows PCs.

The move reduces reliance on OpenAI and Anthropic while strengthening Microsoft’s in-house AI ecosystem for developers and business customers.