Overview
- Satya Nadella told executives Microsoft must rapidly rethink the economics of AI across the company, drawing a direct parallel to its cloud overhaul.
- Nadella appointed Rolf Harms as an adviser on AI economics; Harms authored the 2010 'Economics of the Cloud' paper credited with shaping Microsoft’s cloud strategy.
- Harms will work closely with Nadella and senior leaders while continuing to report to Cloud + AI chief Scott Guthrie.
- The memo describes the platform shift as building a new AI factory and a family of Copilots and agents to drive usage across Microsoft’s stack.
- Reporting notes Microsoft briefly slowed AI spending earlier this year but has since signed large new deals with OpenAI and Anthropic, and the company declined to comment on the memo.