Anthropic’s AI services are too expensive, says Microsoft AI head

Mustafa Suleyman, CEO of Microsoft AI, publicly criticized Anthropic's AI services as "extremely expensive," stating that many users are seeking alternatives. The remarks come as Microsoft shifts GitHub Copilot to usage-based billing and introduces seven new AI models at lower costs to improve enterprise ROI. Microsoft is reportedly canceling most Claude Code licenses in favor of its own Copilot tool.

Projection, much? Microsoft’s head of AI has accused a rival’s AI service of being too pricey, just as the introduction of usage-based pricing for GitHub Copilot https://www.infoworld.com/article/4164236/github-shifts-copilot-to-usage-based-billing-signaling-new-cost-model-for-enterprise-ai-tools.html begins to hit developers using its own services. “Anthropic is extremely expensive and I think many people are urgently looking for alternatives,” Mustafa Suleyman, CEO of Microsoft AI, told Bloomberg News https://www.bloomberg.com/news/newsletters/2026-06-04/microsoft-says-anthropic-models-are-too-expensive . The spotlight is on the cost of AI services at the moment, with so many different parts of the business using the technology https://www.infoworld.com/article/4181397/the-real-cost-of-agentic-ai.html while at the same time many businesses are finding it hard to report any meaningful ROI https://www.computerworld.com/article/4142408/ai-budgets-soar-roi-still-elusive.html . This week, Microsoft at its annual Build conference looked to fight back against this when it announced seven new AI models https://microsoft.ai/news/building-a-hillclimbing-machine-launching-seven-new-mai-models/ , emphasizing the lower cost. The company hopes that cheaper AI models will mean more enterprises find that AI projects are viable. In 2025, Gartner reported https://www.computerworld.com/article/4016206/nearly-half-of-agentic-ai-projects-will-be-killed-by-27-due-to-hype-costs-and-risks.html that many such endeavors would be cancelled by 2027: cheaper implementations could be the way forward. Microsoft clearly sees its own AI developer tools as a better deal than those of Anthropic: Last month it was reported that Microsoft would cancel most of its Claude Code licenses at the end of the half-year period in June, moving engineers to its own CoPilot tool. This article first appeared on CIO.