Microsoft CEO has a warning about the AI race

Microsoft CEO Satya Nadella issued a warning that the tech giants competing in the AI race need to ensure they advance the emerging tech in a way that's palatable to the public.

Nadella said in an interview with The Wall Street Journal that the handful of companies at the forefront of the AI race calling for large amounts of resources to expand may not make a compelling case to the public alongside concerns about the safety of AI and its workforce impact.

"You can't say, hey, all white-collar jobs are gone and this could even be a weapon and we will use all the power to build data centers," Nadella told the Journal.

He added that he doesn't think the public will tolerate a few AI models and companies "doing all of the learning for the world."

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Nadella went on to say that corporate leaders who view AI as a means to eliminate jobs and reduce costs are looking at the technology wrong, saying they should instead be thinking about "reorganizing the job" to better leverage their workers' abilities. The Microsoft CEO said that companies need to have both human capital and in-house AI capabilities he referred to as "token capital."

That can serve as a "recipe" for how firms across the economy can harness both AI and workers, though he acknowledged that "it's a lot of change management, it's a lot of displacement, but there is a path."

The combination of knowledge derived from humans and AI can create a "continuous learning system" and the character of companies will be defined by the "tacit knowledge that they contain" from both sources," Nadella added.

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He added that companies will have to take tangible steps to persuade the public and workforce about the economic opportunities ahead, as narratives alone won't be sufficient.

"No amount of just narrative is going to do it because where we are now, we have to sort of walk the walk," Nadella told the Journal. "We now have to do the hard work in earning the social permission."

Microsoft has recently pivoted in the AI race to offer a suite of low-cost models that aim to reduce prices for customers, as many face mounting bills amid the push to implement AI tools into operational tasks.

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The move aims to shift the focus of the AI rollout from the makers of frontier models to commoditizing models by offering them through its Copilot platform. 

Microsoft is a longtime partner of ChatGPT-maker OpenAI, though the companies recently reached an agreement to allow OpenAI to work more deeply with other tech firms, while it also secured a deal with Anthropic last year.

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Axios previously reported that Microsoft was weighing offering a version of the Chinese model DeepSeek on Copilot.