Microsoft Corp. (NASDAQ:MSFT) CEO Satya Nadella says a few companies should not be allowed to capture all of AI’s value, and he is building a strategy to stop them.
In an interview with the Wall Street Journal this week, Nadella took aim at the firms warning about lost jobs and safety risks while demanding vast resources to expand, a clear shot at OpenAI and Anthropic.
“No amount of just narrative is going to do it because where we are now, we have to sort of walk the walk,” according to Nadella.
The company is weighing whether to host a version of DeepSeek, the ultralow-cost Chinese model that OpenAI and Anthropic have accused of copying their systems, according to the Journal.
That move may pull users toward the cheaper option and drag both U.S. labs into a prolonged price war.
Microsoft Bets On Cheaper Models
Nadella’s pitch is commoditization.
He described AI as a knowledge engine that companies control, tapping a spectrum of models at different prices rather than leaning on a few frontier labs.
Microsoft has trailed its rivals on homegrown models, and Copilot users increasingly preferred Google’s Gemini in late 2025, according to Recon Analytics.
Why It Threatens The IPO Story
The timing may be brutal for Anthropic and OpenAI, as they both reportedly plan to IPO this year. The bull case for both companies rests on frontier AI staying a premium, high-margin product, the kind of growth story that carries a roadshow.
On Polymarket, traders give Anthropic a 78% chance of going public before OpenAI, and the company raised $65 billion at a $965 billion valuation in late May on the assumption those margins hold.
Cheap models from a deep-pocketed rival may be the fastest way to puncture them.
Polymarket traders think there is a 36% chance that Anthropic will be valued at over $1.8 trillion. They give just an 11% chance that the company does not complete an IPO this year.
DeepSeek has just a 5% chance of having the best Chinese model by the end of July. Alibaba is in 1st, with 36%.
The Clearest Equity Play
Microsoft is in an awkward spot. It has poured billions into OpenAI as one of its oldest backers and struck a multibillion-dollar deal with Anthropic last year, so a price war would bleed its own investments.
That hands the advantage to Google parent Alphabet Inc. (NASDAQ:GOOGL). It already runs a leading frontier model, owns its chips and has the cash to keep spending, and its Gemini models pulled users away from Copilot last year.
For Nadella, the question is whether DeepSeek squeezes his rivals or his own margins.
Image: Shutterstock
