Microsoft CEO Nadella: AI Partner Opportunity Could Reach $7T
‘We are already as an ecosystem participating in a $4 trillion opportunity that could in fact, grow by another 50 percent,’ says Microsoft CEO Satya Nadella.
Microsoft CEO Satya Nadella called next-generation AI a partner ecosystem opportunity that could span $4 trillion to $6.5 trillion.
Nadella’s comments came Tuesday during the vendor’s annual Inspire partner-focused conference. The Redmond, Wash.-based vendor’s online conference goes from Tuesday to Wednesday.
“Look, we are already as an ecosystem participating in a $4 trillion opportunity that could in fact, grow by another 50 percent,” Nadella said. “So that means approximately ($)2 (trillion) to ($)2.5 trillion dollars of additional TAM (total addressable market) is going to be addressable by all the innovation across our partner ecosystem.”
[RELATED: Microsoft Inspire 2023: The Biggest News In AI, Copilots, Azure]
Microsoft CEO Nadella Talks AI At Inspire 2023
Nadella used his keynote address to also praise partners for spreading the vendor’s technology reach across geographies and industries.
“You all work with us, partner with us, co-create and innovate with us in order to drive that equitable economic growth in every part of the world to ensure that we protect those fundamental rights,” he said. “To ensure that the innovation that we do is protecting our finite resource of the planet. We build trust across everything we do. These are the core pillars of our mission.”
The CEO also made a promise to generative AI users that customer data is not and will not “be used to train any frontier model or any AI model, and that all of their data and all of their AI models will be protected using the best enterprise security and infrastructure.”
“These are very important things for us to stress and, most importantly, to ensure that every customer feels assured that in this age of AI, they’re well protected,” Nadella said. “Whether you’re a startup, an SI (system integrator), an ISV (independent software vendor), we get to address every need out there across the marketplace because of that platform-first approach.”
Nadella used his time to announce or introduce more access to several Microsoft offerings, including:
*Microsoft AI Cloud Partner Program
*Power Automate Process Mining Tools
*Sales Copilot
*Bing Chat Enterprise
Here are some of the other major statements Nadella made during Microsoft Inspire 2023.
Natural Language Interface Is Transformative
We are in the midst of a massive platform shift with the new generation of AI that’s going to transform pretty much every sector, every category of computing. … There are two dimensions to it.
The first dimension is around the user interface. If you think about the arc of computing, the last 70-plus years has been one constant pursuit to create human computer interfaces that are more intuitive, that are more natural. … I grew up through the graphical user interface, the mouse and the keyboard were very revolutionary when they came out – changed how we remediated computer human interaction.
Obviously multi-touch on the phone was another massive shift. But we have arrived at, I would say, that next logical but big leap, which is natural language.
To be able to have natural language as the interface we have with computers has been the pursuit. And we get to exercise that across every application we build, every interface we build.
The second piece is around information management. The entire history of computing has been about digitizing people, places, things – and making sense of them.
That’s really essentially what we’ve done. … We now have a new superpower. We have a reasoning engine that allows us to start with a draft for any activity we want to complete. Any task we want to complete.
We have a reasoning engine that gives us predictive capability. We have a reasoning engine that will give us more insights. That’s the two shifts. When we talk about AI, you can distill it into a more natural interface using natural language, a reasoning engine that works on top of all your data, giving you more power.
Whether it’s work. Whether it’s business process and business applications. Whether it’s security. Whether it’s software development – both low-code, no-code and professional development.
Every software category as we know of it is fundamentally going to be transformed by these two changes in the platform.
Partner Opportunity Could Reach $7T
In my 30-plus years at Microsoft, I’ve lived through these three transformations. And each one of them – whether it’s the PC server, the web internet, mobile cloud – have been massive in terms of creating partner innovation, partner opportunity.
One of the things that have given me the greatest pleasure is to see the composition of our partner ecosystem and how representative it is of all the geographies of the world and also all the sectors of the economy.
Now the question is – what happens next? With this AI comes more opportunity. In fact, if you look at the data that’s coming up, this is probably going to be the most profound shift as a percentage impact on GDP (gross domestic product) of technology.
Something like 10 percent. There will be additional GDP growth. So if we have an economy that’s around ($)100 trillion, we may have ($)7 (trillion) to ($)10 trillion more of GDP growth driven by this next generation of AI technology.
And that translates as a percentage of GDP growth into a massive partner opportunity. Look, we are already as an ecosystem participating in a $4 trillion opportunity that could in fact, grow by another 50 percent. So that means approximately ($)2 (trillion) to ($)2.5 trillion dollars of additional TAM (total addressable market) is going to be addressable by all the innovation across our partner ecosystem.
Partners Needed For ‘Diffusion’
So there’s no question the opportunity is tremendous. And our partner ecosystem, the uniqueness of what you all represent, really is what gets me most excited.
It’s a map of the world. We can reach every community in every country in every sector of the economy, both public and private. That’s what’s exciting.
The rate of diffusion – in fact, one of the most fascinating things in the last six months as I’ve been going to different parts of the world, talking to lots of you, what’s unbelievable is the rate of diffusion of this technology, thanks to all your capability, is what’s most exciting about this particular revolution and platform shift.
And that’s what really grounds us in our mission to empower every person and every organization on the planet to achieve more. In some sense, this is a collective mission.
You all work with us, partner with us, co-create and innovate with us in order to drive that equitable economic growth in every part of the world to ensure that we protect those fundamental rights. To ensure that the innovation that we do is protecting our finite resource of the planet. We build trust across everything we do. These are the core pillars of our mission.
And we’ve been hard at work. And in fact, one of the things that people tell me is like, ‘Satya, you must have decided to do a bunch of press releases starting January.’ Because we’ve been really doing a lot of innovation. Believe me, we have been hard at work over the last multiple years and, for sure, the pace of innovation has picked up in the last six months.
With Copilots, Humans ‘Always In Control’
It’s just not the innovation in our products. We were also able to distill all of this into a first-class platform construct. That’s what we do as a platform company. We built out this copilot stack. And everything from the infrastructure layer all the way to the foundation to how we manage data. … How we think about the foundation models themselves. These reasoning engines that then reason over that data. The orchestration layer, which is going to be one of the most important middle-tier pieces.
And then at the application level, not only do we have what it takes to create the user interface. Copilot is even a design pattern. It’s not about autopilot. Remember, it’s about putting humans in the loop and designing it in such a way that the human is always in control with a copilot that’s powerful and helping them with every task.
So we really brought everything from user experience design patterns to technology into a first-class construct that then in your hands can be translated into unbelievable innovation everywhere.
And that’s what the copilot ecosystem represents. Whether it’s ISVs (independent software vendors), SIs (system integrators), startups all coming together and the combination of the copilot stack, the copilot ecosystem is what drives the AI advantage for us collectively.
Bing Chat Enterprise
I am really thrilled to be announcing Bing Chat Enterprise. This is the feature. This is the product. This is the moment in some sense that every CIO (chief information officer), CISO (chief information security officer), business user has been waiting for.
Give me a ChatGPT that I can use by logging in through AAD (Azure Active Directory) with all the enterprise data privacy and security guarantees. And you have it now. With Bing Chat Enterprise, you log into Bing with AAAD and you really have all the enterprise promises.
And in combination with the Microsoft 365 Copilot … knowledge work and knowledge workflow is going to be completely transformed.
Sales Copilot Introduced
The next thing that I want to announce is the Microsoft Sales Copilot. This is a super exciting next step in the evolution of the scope of copilots.
If you think about it, we’ve talked about horizontal knowledge work. We’ve talked about individuals and individuals collaborating. But now we uplevel this to the level of the organization and business processes that really span the organization.
And this allows any one of us who is in sales to stay in the flow of our activity with our customers. So whether you’re responding in email, or you’re in a team’s meeting, you get to stay in the flow with the customer and ground that activity of customer interaction with CRM (customer relationship management) data, whether it’s from Salesforce or whether it’s from Dynamics 365.
And to be able to complete your tasks without having to go out a bad to your system of record.
That’s the dream that we’ve been waiting for for a long, long time. Every SaaS (software-as-a-service) application category is going to be fundamentally rewired because of this capability.
Power Automate Process Mining Tools
The most important tool that perhaps all of us in our partner ecosystem are going to use is to identify the opportunity for how we drive that AI advantage to every customer. It’s all about process mining.
So I’m very excited to announce the general availability of the process mining tools in Power Automate.
This is the tool chain that every one of us can use to be able to first map out the processes, sales processes, finance, human resources, everything that you can think of which is a business process.
And then optimize that business process with the power of AI – things that can be automated, where you can deploy copilots to give the human in the loop the advantage to advance the business process.
So process mining is the tip of the spear for you to be able to then drive additional value to every customer interaction, every customer deployment and every customer project that you are engaged in.
Azure AI Updates
Now talking about the fourth big area for announcement is our Azure AI updates. … I’m also thrilled to take what we’ve been doing with (Microsoft-backed ChatGPT developer) OpenAI and expand it to the next phase.
The regional expansion of OpenAI APIs … in North America and Europe and for the first time we’re going to be able to deploy this in Asia. … The other element is Microsoft loves open source. … Today is the announcement of (Facebook owner) Meta’s (open source large language model) Llama 2 coming to both Azure and Windows. … One of the most exciting things is to see these models even being optimized for Windows so that application developers now can take advantage of both the frontier models of OpenAI as well as the models that are available in open source to be able to transform every software category there is …
Microsoft AI Cloud Partner Program
My last announcement is around the (Microsoft AI Cloud) Partner Program. … It’s really exciting to see us completely revamp the investments, the incentives, so that you all can really take advantage of everything that this AI age has to offer and drive both business growth for yourselves and, most importantly, value for our customers.
And this is going to span everything. It’s going to be about partners who are startups, ISVs and system integrators of all sizes and across all industry segments.
Data Ownership Promise
We want to be very, very clear that our customers’ data is their own data, that none of that data is being used or will be used to train any frontier model or any AI model, and that all of their data and all of their AI models will be protected using the best enterprise security and infrastructure.
These are very important things for us to stress and, most importantly, to ensure that every customer feels assured that in this age of AI, they’re well protected. … Whether you’re a startup, an SI, an ISV, we get to address every need out there across the marketplace because of that platform-first approach.
We have a business model that is aligned with you. And we collectively have a business model that is aligned with the success of our customers, and the communities and countries we serve.
And lastly, we want to build and we engender trust in how we operate, how we do business. And that to me is what differentiates us as an ecosystem.