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Copilot gaining new features for action-taking and memory

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Microsoft ( MSFT ) faces heavy AI competition as it turns 50 years

old

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CEO Satya Nadella pushes for next innovation

By Jeffrey Dastin

REDMOND, Wash, April 4 (Reuters) - Thousands of people

swooned in a dark conference hall that felt more like a rock

concert when a Microsoft ( MSFT ) product manager demonstrated

the company's latest feature: how to sum numbers in Excel, with

the click of a button.

"It was literally like Mick Jagger walked out," said Yusuf

Mehdi, Microsoft's ( MSFT ) consumer chief marketing officer, who started

as an intern.

That was more than 30 years ago. On Friday, the day

Microsoft ( MSFT ) turned 50, the company's leaders and staff gathered at

its Redmond headquarters to remember the software maker's glory

days while trumpeting what they hope will bring it into the

future: more powerful artificial intelligence.

Copilot, Microsoft's ( MSFT ) AI assistant, is gaining a host of new

features to make it more proactive. The version for consumers

will start remembering personal facts about them. It will offer

birthday reminders or support ahead of a presentation, or

consumers can opt out, Mehdi said in an interview.

Copilot likewise will personalize podcasts and shopping

recommendations, and it will let consumers task their AI to book

events for them, or send a friend a gift while checking in for

guidance. "It frees you up," said Mehdi.

Microsoft ( MSFT ) is hardly first to roll out action-taking or

"agentic" software. As with rival systems, the AI will work best

on popular sites where Microsoft ( MSFT ) has done some behind-the-scenes

technical work, like with 1-800-Flowers.com ( FLWS ) and OpenTable, Mehdi

said.

Mehdi recalled days when Microsoft ( MSFT ) was smaller and growing.

He said CEO Bill Gates could devour three books' worth of

information from one day to the next, at a time when the

co-founder still worked on Microsoft ( MSFT ) software. Mehdi watched

Steve Ballmer, Gates' eventual successor, chant "developers,

developers, developers!" in a sweat-drenched shirt to rouse a

crowd into the ".net" era.

Microsoft ( MSFT ) went from top of the pack to badly bruised in a

high-profile lawsuit that U.S. antitrust enforcers brought

against it in 1998. Years later, younger companies and startups,

among them Alphabet and ChatGPT creator OpenAI, beat

it to the punch on key AI developments.

Satya Nadella, Microsoft's ( MSFT ) current CEO, is not standing

still. The leader who turned Microsoft ( MSFT ) into the No. 2 cloud

powerhouse challenged his executives at an internal summit this

week, recalled Mehdi: "How do we rethink the way that we build

the software?"

Microsoft ( MSFT ) is iterating on its chatbot technology in a

crowded field that includes Elon Musk's xAI and Anthropic. It

has added Copilot to its heavily used productivity suites for

business while giving consumers a distinctive version.

"It's warm; it has that personality," said Mehdi. Some users

have taken to this, while others find it asks too many

questions, he said.

"When we get to now be more personalized, we can start to

get smarter," Mehdi said. "We're part way through that journey."