Microsoft unveils AI-powered Bing Chat Enterprise

Microsoft shares closed at a record high on Tuesday after the tech giant announced its AI productivity software Microsoft 365 Copilot will be priced at $30 per user, per month. Microsoft (MSFT) also debuted Bing Chat Enterprise, a new chat tool that offers businesses concerned about using generative AI more protection and security controls. In an interview with Yahoo Finance Live, Microsoft Corporate Vice President and Chief Consumer Marketing Officer Yusuf Mehdi says that overall, the corporate interest in AI isn't letting up. "There is tremendously broad excitement for the power of AI" and that Microsoft has "gotten lots of inbound demand for it," Mehdi said.

Video transcript

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AKIKO FUJITA: Microsoft's inspired 2023 conference kicking off today with a look at the latest Microsoft cloud and generative AI innovation. Shares of Microsoft jumping on the heels of a big announcement, or we should say some big announcements, including the pricing for its AI subscription service. Joining the conversation, Microsoft's Corporate Vice President and Consumer Chief Marketing Officer, Yusuf Mehdi, along with our very own Dan Howley. Dan.

DAN HOWLEY: That's right, Akiko. And welcome, Yusuf. I kind of want to kick things off, first with the pricing for Microsoft 365 Copilot. This is part of the reason why we're seeing shares of Microsoft jump this afternoon. And you know, $30 per user per month. It's pricier than we've seen for other Microsoft Offerings can you just walk us through the decision-making process there? And why that price? And what that provides to users?

YUSUF MEHDI: Sure, Dan. Yeah. And just to-- just from the start, today is a huge day for generative AI to now be used at work. And I think that's the big thing, which is that up until today, there's been a lot of excitement about AI. But it's not used in the workplace, because people are worried about their confidential data leaking out.

Today, we made two big announcements to help with that. One is Bing Chat Enterprise, which we can talk about in a second. And the other, as you mentioned, is the Microsoft 365 Copilot pricing. The way I think about it is we have a good, better, best offering for customers. There's Bing, as you know it. And we've been able to use today. It's free for everybody.

Then there's Bing Chat Enterprise, which is free if you're a Microsoft 365 subscriber. And we'll have a standalone price of $5 if you're not. And then finally, Microsoft 365 Copilot, which gives you the ability to reason over all of your data, use it natively within your Microsoft Office apps, and do some pretty unique things like get Team Summaries from Teams Meetings.

We've been in pilot. We've gotten great feedback on the value. And that's what led to the pricing.

DAN HOWLEY: And so you know, when it comes to these two products, Microsoft 365 Copilot, that basically allows users to get access to both the web version of Bing, but then also pull in their own information from, you know, their own databases at their company.

So I think one example that's been tossed around is if you're a health care provider and you're trying to look for a health care plan, or a customer trying to look for a health care plan, they'd be able to reason over that quickly using the capabilities. Is that-- is that kind of accurate?

YUSUF MEHDI: Yeah, that's right. And so you can do what the scenario you just talked about, Dan, in Bing Chat Enterprise for free if you're an M365 customer. So you can, for example, let's say, you're building that confidential health device, and you want to use AI to help you create the proposal and create the strategy. You can enter now that confidential specifications about the device, get data from the web, compare the two, help it build your strategy, help it write your documents, and be confident that none of that data is going out into the into the AI system. It's not training the models. No one looks at that data.

And that you can get today with Bing Chat Enterprise. And then Microsoft 365 Copilot takes it to another level, because you can now just point the AI to any of your documents-- Powerpoints, or Word, or Excel-- and have it automatically work for you.

DAN HOWLEY: So you know, we have, obviously, a lot of talk of over the past half year, you'd say. You know, obviously, you guys launched in February with Bing and the new version of Edge. What kind of uptake are we seeing? You know, is this something where customers are continually asking about Microsoft's products?

I mean, you have it across, you know, obviously, 365. You have the standard Bing. There's multiple permutations of going on here. Are customers kind of like rushing out to Microsoft to say we want more? Are they tepid? What's the response kind of been?

YUSUF MEHDI: Yeah. It's a great question, Dan. I'd say, it's a couple of things. First off, there is tremendously broad excitement for the power of AI and what to do. And so we've gotten lots of inbound demand for it. The actual what we think of as product market fit, as you talk about in the tech world, I would say, we've found that with a class of people and a class of scenarios-- people who are writing code, people who are writing long documents, doing strategy and analysis and creativity. For those use cases and for people who do that, that has taken off.

For the general public, I think they're still trying it. They're still learning how to use it better. And that's why today's announcement is such a big deal, because those use cases that are working are really what people do at work. And that's why I think today, we're going to see that, because companies have been clamoring to want to use this generative AI at work. But they've had to actually ban it for legitimate concerns about their data privacy. Those all go away starting today.

DAN HOWLEY: And what are those concerns when it comes to the data privacy? What are they outside, if you're not using a Bing Enterprise Chat?

YUSUF MEHDI: So there's a couple of things. First is there's a concern that if you do-- if you, you know, do a chat or a private search, as we said, that your data goes outside the org boundary. The second is, is there any co-mingling of user data with web data? That doesn't happen. The third is, is the data that's being used, is that actually being used to train an AI so that that someone else goes and uses AI start to get learn from your data? And then the last thing is, hey, are the chats saved, or are they stored?

All those things are protected with Bing chat. Enterprise. And so you can essentially chat and search with confidence that none of that data is going out, none of it's training AI models, none of it's stored. No Microsoft person looks at your data. It's all completely private.

DAN HOWLEY: And then I just want to ask you, you know, obviously, you're not a fortune teller. Unless you are, in which case I'd like to know the powerball numbers. But guessing that you're not, where do you see this kind of AI capability continuing to go? Where are we going to see it start to bubble up next?

YUSUF MEHDI: Well, we're such an exciting time right now. I think we're going to see this world explode. Like we said, today is the unlock for everyone at work to now start using chat to be more creative, to be more productive at work. We think that's going to really fly.

We talked a lot last month about build, about plug-ins. This is for third party companies to come in and then add on top of the chat, so you can get legal advice. You can get shopping help. You can get travel help within the chat service. So if you're an individual user and you're saying, hey, help me proofread this legal document, you can call those. I think that will take off.

And then as we get to Copilot, to have it in the natural flow of your work, just as you're within Powerpoint or you're within teams. And you can say, what did I miss in this meeting? What action items did I get if I wasn't at a particular meeting? What's the most important thing I should be working on this week? All of those capabilities in Microsoft 365 Copilot, all of that will happen.

So I think you're going to see an acceleration of how AI really empowers you to be essentially a superuser, a poweruser, whether you're in windows or any of our Microsoft software applications.

DAN HOWLEY: All right. Microsoft Corporate Vice President and Chief Consumer Marketing Officer Yusuf Mehdi, thank you so much for joining us.

YUSUF MEHDI: Thank you, Dan.