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The big news today sees Microsoft considering raising the prices of its suite of software tools. Attempting to reap the benefits of AI investments.
On Deck:
But first let's talk about the price.
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The big story
Microsoft’s ROI for AI
Microsoft wants to benefit from its AI investments, and it expects you to cover the costs.
The tech giant Microsoft 365 pricing plans under review Business Insider's Ashley Stewart wrote that the company will raise prices by adding AI capabilities to its widely used suite of productivity tools, SmartPhone, creating more expensive bundles.
Microsoft executives are expected to discuss plans this summer, with the goal of having a decision by September, when sales are expected to surge.
The changes come as Microsoft hopes to reap the benefits of the billions of dollars it has invested in AI. Millions of expensive AI chips An ambitious plan Expanding the size of your data centerMicrosoft is making a big bet on the future of AI.
The company's AI investments are already paying off to some extent: Microsoft hit a market capitalization of $3 trillion this year for the first time, making it the world's most valuable company. Its early investment in OpenAI gave the company a huge advantage as the generative AI boom hit.
But AI tools Maintenance costs are not cheapSo it remains important to find ways to make money from it quickly.
As one of the company's flagship products, Microsoft 365 is a natural place to start: users can already add the Copilot AI assistant tool to the Microsoft 365 suite for an additional fee, packaging it together to save users the trouble of managing multiple software licenses.
Microsoft's RFP on AI ROI illustrates the shift in technology motivations.
Microsoft could have done better by investing more in AI. Zero interest rate phenomenonHowever, Big Tech’s “The Year of Efficiency“In 2023, purse strings are going to be tightened a lot.
Today, even companies near the top of the AI hierarchy are closely monitoring their revenue. Microsoft cuts Azure cloud business the AI Pivot.
And this is the most valuable company in the world!
What about AI startups that have raised millions of dollars simply for having a good idea? How much time do they have before investors expect a return?
Some seem to be realizing that the runway is getting shorter. Take OpenAI, for example, which has made two high-profile hires. Serving as Chief Financial Officer and Chief Product Officer.
Three things in the market
- Learn more about Goldman's summer internship program. Pictured outside 200 West Street. A letter from CEO David Solomon. BI spoke exclusively to him. First day of Goldman's internship program.
- China has put the brakes on its gold buying spree. The country's central bank has been buying gold for 18 straight months, but as gold prices have reached record highs, China refrains from further procurement.
- Boring stocks are poised for a “renaissance” rise. Bank of America predicts that large-cap value stocks will outperform growth stocks for the first time in a while. They recommended four sector ETFs To take advantage of opportunities.
Three things about technology
- Here are the top 60 angel investors backing B2B startups. Angel investors provide startups with that crucial first check to help grow their idea into the next big thing. With the help of Wing VC, BI 60 Top Angel Investors Investing in B2B Startups.
- Nvidia is on the defensive. Big tech companies and startups are vying to grab some of Nvidia's market dominance, according to a Morgan Stanley analyst note. Nvidia is “clearly focused on defending its market share.”
- OpenAI and Sam Altman may be the biggest winners of WWDC. Apple's AI Announcement Might not be enough ChatGPT integration to attract new Apple customers Big support for OpenAI and its CEOThis gives you access to a huge new user base.
Three things in business
- Abercrombie is having its Lazarus moment. The clothing company, which was an “it” brand among young people in the early 2000s, has struggled over the past decade. Abercrombie has come back from the deadAnd now investors are happy to accept it.
- Elon Musk wants to get advertisers on board (again). Musk has had a rocky relationship with advertisers since giving them the finger last year and is currently due to speak at the Cannes Lions advertising summit. Where big tech companies go to attract advertisers.
- We are witnessing the biggest AI deal ever. Apple announced the integration of ChatGPT with Siri, and one Apple executive said there may be a similar deal with Google Gemini. What we know about who is paying who — And what's at stake?
In other news
Today's happenings
- Today's earnings: The Federal Open Market Committee makes decisions about interest rates.
From the Insider Today team: Deputy editor and anchor Dan DeFrancesco in New York; editor Jordan Parker Erb in New York; managing editor Hallam Bullock in London; reporter George Glover in London.
