After a year of Bing, Microsoft unveils its next major AI initiative

A year ago today, Microsoft revealed its ambitious plans for an AI-powered Bing search engine. It was the most significant launch in Bing’s history, helped to further drive AI usage into the mainstream, and sparked bouts of anticipation and alarm about what AI could potentially impact next. The release was successful enough to unsettle Google, who was swiftly perceived as falling behind in artificial intelligence.

“Surely they will want to come out and show that they can dance,” Microsoft CEO Satya Nadella told The Verge at the time. “And I want people to know that we made them dance.”

The tactic proved effective. However, a year later, Bing seems to have dropped out of the conversation. Google still dominates over 91 percent of the traditional search market share, according to StatCounter. Meanwhile, Bing grew by less than half a percent in the search market globally.

Microsoft does not view this as a failure by any means. “We’ve seen [Bing] share grow,” says Yusuf Mehdi, executive vice president and chief marketing officer at Microsoft. The launch might not have “entirely reshaped the search landscape,” but it has been significant for Microsoft. “Even a few points of share growth is significant for Microsoft and for customers to bring more competition.”

However, instead of Bing taking the lead, Microsoft has shifted its focus to Copilot, an “AI companion” strategically placed in all key software and services. Microsoft has even created a Super Bowl ad for Copilot, which will air on Sunday. After diverting attention away from Bing a few months ago, Copilot is now being positioned as the future of Microsoft’s AI initiatives, which emphasize productivity and creation over search.

This unexpected Super Bowl commercial for Copilot is a dramatic shift from Microsoft’s previous multimillion-dollar ads that highlighted the importance of its software and told emotional stories of gamers with disabilities. This time, there are no Windows PCs, spreadsheets, or Xbox consoles — just a single iPhone and an effort to encourage people to download the Copilot app on iOS and Android. If you’ve never heard of Copilot, you wouldn’t even realize it’s a Microsoft commercial until the very end.

“This is a significant development for a company that historically, at least with individuals, has been heavily focused on the PC,” says Mehdi.

The new Super Bowl ad, which revolves around using AI to be creative, walks a fine line between empowering people to do things they would usually need to learn and be skilled in, and concerns over AI replacing jobs, especially in the creative industry.

A subtle yet intriguing change in Microsoft’s AI strategies involves shifting the focus away from the renewed search battle with Google to making Copilot a stand-alone product. “We really got behind a single brand called Copilot, so we cleaned up all these other things, and we renamed Bing Chat,” says Mehdi. “So we have one brand, one experience.”

Furthermore, Microsoft is rolling out new Copilot features to enhance the overall user experience and the image creation capabilities of its AI assistant. On the image creation side, you can now highlight objects in an AI-generated photo, blur the background of an image, or add an effect like pixel art to an image. The company has also worked to sharpen the app’s appearance.

“You’ll see a new look and feel. We’ve made a lot of subtle user experience improvements, like the color treatments, the spacing, and it will be much faster,” says Mehdi. The focus on image creation stemmed from observing how Bing users were embracing Copilot. “Image creation is one of the things that’s really gaining traction. I think it’s the first step in unlocking the ability for people to feel like they can be a creator again,” points out Mehdi.

The surge in Copilot’s popularity for image creation is largely attributed to Microsoft making it available to anyone free of charge. While this is convenient, it also exposes these tools to exploitation. Microsoft had to address a loophole in its AI image generator that could generate explicit images of celebrities. Last month, AI-generated images of Taylor Swift became a trending topic, with reports of people creating and exchanging similar images using the Microsoft Designer AI image creator. Microsoft CEO Nadella referred to the AI fakes as “alarming and terrible,” and stated that they were “continuing to investigate these images and have strengthened our existing safety systems to further prevent our services from being misused to help generate images like them.”

Apart from image creation, many Copilot users are employing it for programming to write code, research, and analysis, indicating a growing interest in the AI companion beyond traditional search functionality.

The shift away from search as the primary AI entry point for Microsoft is also influencing how Copilot is integrated into various products and services. The Copilot brand has been somewhat confusing over the past year, starting from inside GitHub to sales products, and then rebranding as Copilot for Microsoft 365 inside Office apps. However, it now seems that every department at Microsoft is focused on launching separate Copilots without a unified effort.

This is now changing. “We want to have a single Copilot for every individual,” Mehdi discloses. “This Copilot can then add capabilities as you subscribe to them.” Consequently, if you subscribe to Copilot Pro or Copilot for Microsoft 365 in the future, it will simply be an add-on to the main Copilot.

“Over time, I think you’ll see us continue to add more and more of those things. So the idea of a personal Copilot that is yours, we want to get to that and want it to unlock everything you’ve got with your personal IDs and work IDs,” says Mehdi. “Where we go from there we’ll see. There are a lot of extensions that are coming to Copilot, whether those are GPTs or plug-ins, or the ability to do custom Copilots themselves.”

Additionally, Microsoft is in the process of developing a significant Windows refresh focused on AI. While Mehdi did not specify the details of Microsoft’s plan to overhaul Windows for AI, he hinted at what to expect. “The unique thing about Copilot in Windows is that it can be aware of the context you’re in,” Mehdi explains. “It can understand the pages, so it can do more intricate things.”

Microsoft is also considering running advanced AI models locally on PCs, leveraging the NPU hardware shipping in Windows laptops, and using AI to empower everyone as a Windows power user.

“I think it’s something like 20 percent of [Windows] users use 10 percent of the features. Once you can say, ‘Hey turn my PC into dark mode, configure that printer for me, help me get the following going,’ we can turn everyone into a power user of Windows,” says Mehdi. “It sounds cliche, but what I think that will unlock in terms of people’s ability to use computers to do amazing things will be quite profound.”

Although Bing’s AI has faded from the forefront over the past year, it’s evident that it sparked a major transformation for Microsoft. And while the impact on Bing was not extensive, it has significantly influenced the overall product lineup.

“When we launched, we said we had to start at some place,” says Mehdi. “I think we made the right call to start with Bing.”

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