Bing director resigned after Microsoft chose DeepMind co-founder as AI leader

The move comes a week after the US software giant appointed Mustafa Suleyman in charge of artificial intelligence (AI) for users and asked Mikhail Parakhin to report to him.

Microsoft said Mikhail Parakhin (formerly executive director of advertising and web services) will report to Chief Technology Officer Kevin Scott while he searches for his next job.

Mikhail Parakhin also oversaw some of the company's Windows software business. That job will be transferred to Pavan Davuluri, who previously oversaw the hardware and the rest of Windows.

From now on, Pavan Davuluri will run the entire Windows and Surface hardware business, reporting to Executive Vice President Rajesh Jha.

It is unclear whether Mikhail Parakhin is leaving Microsoft or taking on a new role within the company.

Bing director resigned after Microsoft chose DeepMind co-founder as AI leader Picture 1

Mikhail Parakhin's departure from the core of Microsoft's consumer AI products marks the first change stemming from the company's CEO Satya Nadella's appointment last week of DeepMind co-founder Mustafa Suleyman. and former Inflection AI CEO) to lead the newly formed consumer AI unit.

This move shows that Satya Nadella is impatient with his current team. Over the past year, Microsoft has brought AI to its Bing search engine, Windows, Office and other products, creating various digital assistants under the Copilot brand. However, Bing has not yet made much progress compared to Google, the search market leader, and other products are still in development.

In addition to appointing Mustafa Suleyman, Microsoft also recruited most of the 70-person team from his startup Inflection AI.

Karen Simonyan (co-founder of Inflection AI with Mustafa Suleyman) and Reid Hoffman (Microsoft board member) will join Microsoft AI as chief scientists. Inflection AI's vice president of engineering also joined Microsoft, according to his LinkedIn profile.

Mustafa Suleyman will be CEO of the Microsoft AI unit, which brings together the company's consumer AI efforts such as the Copilot chatbot, the Edge browser and the Bing search engine that uses the technology.

Built with technology from OpenAI (the startup behind ChatGPT and Sora), Copilot is a pillar of Microsoft's push to generate revenue from AI, which can write emails, summarize documents, and give presentations.

'The entry of these new talents will help us accelerate progress once again,' Satya Nadella said in a blog post. As part of this transition, Mikhail Parakhin and his entire team of Copilot, Bing and Edge; Misha Bilenko and the generative AI team will report to Mustafa Suleyman'.

Previously, Microsoft also cooperated with other startups, including Mistral AI (France), in the context of increased regulatory scrutiny of their partnership with OpenAI. Satya Nadella emphasized that Microsoft is very committed to its OpenAI partnership.

Inflection AI has emerged as one of the most successful names in the generative AI race after raising $1.3 billion from Microsoft and Nvidia, with a valuation of $4 billion in June 2023.

Behind the Pi chatbot, Inflection AI announced that Sean White (former director of research and development at Mozilla) will be the company's new CEO and they plan to shift to selling AI models to commercial customers. instead of focusing on the consumer.

According to Reuters sources, Microsoft has agreed to pay about $650 in cash to Inflection AI in an unusual deal, allowing it to use AI models and hire most of the startup's employees, including founders, .

Inflection AI AI models will be available on the Microsoft Azure cloud service, including Inflection-2.5.

Inflection AI will use licensing fees to pay Greylock, Dragoneer and several other investors, the source added.

According to Reuters, investors in Inflection AI will receive 1.5 times the amount they poured into this startup.

Experts say the new deal with Inflection AI could subject Microsoft to stricter scrutiny from regulators.

"This deal can be seen as an attempt to minimize competition in the platform models market, as Inflection AI will become a clone of itself," said Steven Weber, a professor at the School of Engineering. Information from the University of California – Berkeley (USA).

Microsoft currently faces investigations from the US Federal Trade Commission over its AI investments, including billions of dollars in funding for OpenAI. The US Federal Trade Commission is examining whether the deal violates antitrust laws.

Microsoft's main rival moved strongly

As Microsoft's main rival in the generative AI race, Google is expanding its efforts related to the technology.

Apple is in talks to integrate Google's Gemini AI model suite into the iPhone, according to Bloomberg sources familiar with the situation.

If realized, the agreement between Apple and Google will build on the long-standing search partnership between the two companies. For years, Google has paid Apple billions of dollars each year to make its search engine the default option in the Safari web browser on iPhones and other devices.

A deal would give Gemini an important advantage with billions of potential users. But this could also be a sign that Apple isn't as far along with its AI efforts as some expected, and that both companies risk further antitrust scrutiny.

Since early last year, Apple has been testing its own large language model codenamed Ajax. Some employees are also trying out the basic Apple GPT chatbot. However, according to sources from Bloomberg, Apple's technology is still inferior to AI tools from Google and other competitors, making the partnership seem like a better choice.

The deal with Apple, if it happens, would be Google's most high-profile partnership with Gemini to date and could be an important lever for the internet search giant's AI efforts. Apple has more than 2 billion devices in use and is likely to become home to Google Gemini by the end of 2024. In January, Samsung Electronics launched the Galaxy S24, Galaxy S24+ and Galaxy S24 Ultra smartphones with the following features: AI powered by Gemini.

A partnership between two Silicon Valley giants is likely to attract the attention of regulators. The current agreement between Google and Apple regarding search has become the focus of a lawsuit by the US Department of Justice. The US government alleges that the two companies operated as a single entity to dominate the mobile search market. The duo justified the arrangement by saying that Apple believes Google's search quality is superior to its competitors and that it's easy to switch search engines on the iPhone.

The agreement between Apple and Google is also being criticized in the European Union (EU), forcing Apple to make it easier for consumers to change the default search engine from Google. As regulatory pressure grows and AI becomes more widespread, the current search deal could ultimately be less profitable for both companies. A new deal on AI could help offset that.

While negotiations between Apple and Google are still ongoing, it's unlikely any deal will be announced before June, when the iPhone maker plans to hold its annual worldwide developers conference. . It's possible the two companies can't reach an agreement or Apple ultimately chooses to partner with another generative AI provider, such as OpenAI.

Theoretically, Apple could work with multiple partners, like it does with the search feature in its web browser. Another prominent generative AI provider is Anthropic, with its Claude chatbot.

Lesley Montoya

Update 04 April 2024