Several weeks back, Microsoft's CEO, Satya Nadella, dispatched an email to the engineering head overseeing the consumer-grade Copilot (an AI assistant integrated into numerous Microsoft products). Within the email, a Microsoft manager highlighted that Google Gemini chatbot's recent capability to link with Google Drive had seen a marked enhancement, such as excelling in summarizing folder photo content. Nadella voiced his discontent with Microsoft's equivalent technology, pointing out flaws in Copilot's connection solutions for Gmail and Outlook, labeling them as 'malfunctioning' and 'insufficiently intelligent.' Over the past few months, Nadella has steadily emerged as one of Microsoft's most influential product visionaries. In September of the previous year, he announced his intention to delegate certain responsibilities to concentrate more on AI product development, data center construction, and research aimed at boosting the intelligence of AI models. He delegated numerous business functions to Judson Althoff, Microsoft's sales chief, who was bestowed with the new title of 'Commercial CEO.' Tanuja Kolprle, a former Microsoft product manager and current CTO of Bonterra, observed that GitHub Copilot had performed outstandingly in early 2024 but had significantly lagged behind Cursor by early 2025. Nadella has been unsparing in his criticism of Copilot's internal shortcomings yet remains resolutely supportive of the product. This year, he has shared at least 81 Copilot-related posts on the X platform, more than twice the number from 2024, encompassing product announcements, use cases, and user feedback.

Microsoft's enterprise-level objective is to transform Copilot into a 'digital employee' capable of autonomously executing tasks akin to those of an administrative assistant. In the near term, Nadella's foremost concern is the pace at which engineers progress the product. Some employees reported that during the summer, he voiced his grievances in a Teams group of top engineers regarding the sluggish rollout of complex Excel features. Subsequently, Microsoft implemented several enhancements to Excel, including adopting a new model from Anthropic to supplant OpenAI's model, though some features were still launched weeks behind the planned schedule. Meanwhile, a growing number of customers are beginning to question the cost-effectiveness of the paid Copilot. The mayor of Sioux Falls, South Dakota, stated that city government employees favor using the free ChatGPT and may opt not to renew their Copilot subscriptions. He emphasized that with a plethora of free and subscription-free alternatives available, the value proposition of paid AI must be exceptionally compelling to entice users to continue their purchases.