Microsoft
Microsoft agrees to stronger AI privacy rules for students
Millions of students use AI chatbots every day for schoolwork, emotional support and personal advice, often without knowing how their conversations and other personal information may be stored or used.
As AI becomes increasingly common in classrooms, educators, parents and students are raising concerns about data privacy and the role schools should play in protecting children’s information.
The issue has gained attention as the two largest US school districts, New York City and Los Angeles, announced plans to limit student use of AI for a year while they examine how the technology should be used in education.
Against this backdrop, Microsoft last week agreed to adopt stronger privacy and safety standards for AI used in schools following negotiations with the American Federation of Teachers (AFT), the country’s second-largest teachers union.
The agreement has important safety measures, but they will have a wider impact only if other major AI companies adopt similar standards, said Josh Golin, executive director of online safety nonprofit Fairplay.
“I worry that a high-profile framework like this will be misunderstood and schools will think, ‘If they’re doing a good job on data privacy and safety, then that means we should be using the tool,’” Golin said.
The AFT said the legally binding agreement, which includes independent audits, could become an industry standard. OpenAI and Anthropic said they are also discussing similar agreements with the union. Google, however, has not said whether it will adopt the same protections.
Limits on use of student data
Under the agreement, Microsoft will not use student or educator data to train its AI systems, except for a limited purpose related to protecting students.
The company also says collected data cannot be sold, used for advertising or used to develop products.
The agreement bans AI companions and other features designed to create emotional attachment or dependency or keep students engaged beyond what is needed for learning.
It also requires audits and greater transparency, including explaining to families in clear language how Microsoft’s AI tools work.
“This standard sets a high bar for child privacy and AI safety, and we’ll extend this agreement to every school district across the country,” Microsoft Vice Chair and President Brad Smith said.
The standards will apply from Nov. 1 to all schools that have contracts with Microsoft, he said.
AFT President Randi Weingarten described the agreement as the first of its kind and an important step toward creating industry-wide standards in the absence of federal or state laws governing AI use in schools.
“We want parents to have control of their kids’ education. We want educators to have control of kids’ education, not ed tech,” Weingarten said.
She made the comments at a joint news conference with Smith at the headquarters of the United Federation of Teachers in New York City. The building houses the AFT’s National Academy for AI Instruction for teachers, which launched a year ago with $23 million in support from Microsoft, OpenAI and Anthropic.
New York City and Los Angeles are also planning extensive reviews of their education technology contracts and AI tools, focusing on privacy, transparency and accountability.
New York City’s one-year AI restriction applies to elementary and middle school students, while Los Angeles’ policy covers students through high school.
Union seeks similar commitments from Google and others
Weingarten said she contacted Google before the Microsoft agreement was announced and invited the company to become a signatory.
Google has not responded to an AP request for comment on whether it plans to adopt similar protections.
“Is Google going to embrace this framework? That is a huge question,” Golin said, noting that schools also use thousands of AI-powered educational technology products made by smaller companies.
Google faced criticism in August after announcing that it had enabled its Gemini chatbot for many K-12 students using Google Classroom, its learning management platform.
Google says Classroom is used by about 150 million teachers and students worldwide.
Critics said the move intensified competition among technology companies to expand their presence in schools and attract the next generation of AI users.
The Gemini feature is available only to schools that allow students to use the Gemini app or Gemini Notebook. Until August, Google had allowed Gemini access only to students aged 18 or older.
Weingarten said the union is also negotiating with OpenAI and Anthropic, both of which have welcomed the Microsoft agreement.
OpenAI, the creator of ChatGPT, called the deal an “important milestone for AI safety and privacy in schools” and said it hoped to finalize its own agreement with the AFT.
Anthropic, which makes Claude, said it welcomed efforts to promote responsible AI use in education and was working with the AFT toward what it called a “gold standard for safety and privacy.”
Experts say companies should carry the privacy burden
Data privacy experts said the new standards could influence how schools negotiate with AI companies, even when they do not use Microsoft products.
Elizabeth Laird, director at the Center for Democracy and Technology, said the agreement could reduce the pressure on individual school districts to negotiate privacy protections with large technology companies.
Previously, schools’ ability to secure stronger protections often depended on their financial resources and bargaining power.
Laird said the agreement could help reduce such differences between school districts. She also praised Microsoft for going beyond existing legal requirements for companies providing technology to schools.
For example, Microsoft has agreed not to use sensitive information such as gender, race, age and ZIP codes, which can sometimes be used to identify individuals even after their names have been removed.
However, Laird said the agreement also shows how difficult it is to establish consistent AI standards without legislation.
She said responsibility for protecting students’ privacy should rest with technology companies rather than parents, students or individual schools.
Microsoft’s Smith acknowledged that technology companies have been slow to accept that responsibility.
“There are important discussions and debates all across the country about when AI should be used in schools, how it should be used, for what purpose,” he said. “It is our role, even our responsibility, to ensure that AI is provided in a form that teachers and kids and parents can trust.”
4 days ago
Microsoft to cut 4,800 jobs, including 1,600 at Xbox, amid gaming business overhaul
Microsoft is cutting 4,800 jobs, or about 2.1% of its global workforce, including around 1,600 positions in its Xbox gaming division, as the company restructures the business to improve its performance.
The company announced Monday that the Xbox layoffs are part of a broader reorganization aimed at "resetting" the gaming business as it faces growing competition.
"Our business today is not healthy," Xbox CEO Asha Sharma said in a memo to employees. Sharma, who took charge of the gaming division earlier this year, said Xbox's profit margins are three to 10 times lower than those of comparable gaming platforms and publishing businesses.
She said the gaming industry is also facing a major hardware crisis as the cost of console components continues to rise. Xbox competes with Sony's PlayStation and Nintendo's Switch in the global console market.
Sharma said Microsoft plans to eliminate another 1,600 Xbox jobs during the current fiscal year, which began last week. The company will also spin off four video game development studios that it had previously acquired.
Microsoft completed its $69 billion acquisition of gaming company Activision Blizzard nearly three years ago. The deal brought popular franchises such as Call of Duty under Microsoft's ownership and was intended to strengthen its game development portfolio while expanding its Netflix-style game subscription service.
However, Sharma said those businesses had generated value but had not grown as quickly as the company had expected.
The Xbox job cuts come on top of Microsoft's wider workforce reduction announced Monday. Chief People Officer Amy Coleman said the broader layoffs reflect changing customer needs.
In a blog post, Coleman also clarified that the positions being eliminated are "not being replaced by AI."
The latest layoffs follow voluntary buyout offers Microsoft made to about 8,750 employees in May. According to Coleman, more than 30% of eligible workers accepted those retirement offers.
2 months ago
Microsoft admits Copilot error exposed some confidential emails
Microsoft has acknowledged a technical error that caused its artificial intelligence work assistant, Microsoft 365 Copilot Chat, to access and summarise some users’ confidential emails by mistake.
Microsoft has promoted Copilot Chat as a secure AI tool for workplaces. However, the company said a recent issue allowed the tool to surface content from some enterprise users’ Outlook draft and sent email folders, including messages marked as confidential.
The tech giant said it has now rolled out a global update to fix the problem and insisted that the error did not allow users to see information they were not already authorised to access.
“We identified and addressed an issue where Microsoft 365 Copilot Chat could return content from emails labelled confidential authored by a user and stored within their Draft and Sent Items in Outlook desktop,” a Microsoft spokesperson said. The spokesperson added that while access controls and data protection policies remained in place, the behaviour did not match the intended Copilot experience.
Copilot Chat works inside Microsoft programs such as Outlook and Teams, allowing users to ask questions or generate summaries of messages and chats.
The issue was first reported by technology news site Bleeping Computer, which cited a Microsoft service alert stating that emails with confidential labels were being incorrectly processed by Copilot Chat. According to the alert, a work tab within Copilot summarised emails stored in users’ draft and sent folders, even when sensitivity labels and data loss prevention policies were in place.
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Reports suggest Microsoft became aware of the issue in January. The notice was also shared on a support dashboard for NHS staff in England, where the root cause was described as a code issue. However, the National Health Service said no patient information had been exposed and that the contents of draft or sent emails remained visible only to their creators.
Despite Microsoft’s assurances, experts warned that such incidents highlight the risks of rapidly deploying generative AI tools in workplaces.
Nader Henein, an analyst at Gartner, said mistakes of this kind are difficult to avoid given the fast pace at which new AI features are being released. He said many organisations lack the tools needed to properly manage and govern each new capability.
Cybersecurity expert Professor Alan Woodward of the University of Surrey said the incident underlined the need for AI tools to be private by default and enabled only by choice.
He warned that as AI systems evolve rapidly, unintentional data leakage is likely to occur, even when security safeguards are in place. #From BBC
6 months ago
Microsoft unveils AI Content Marketplace
Microsoft has launched a pilot platform that allows artificial intelligence developers to pay publishers for using licensed “premium content” to train their AI models, aiming to create a new revenue stream for media organisations while improving the quality of AI-generated responses.
The platform, called the Publisher Content Marketplace (PCM), will enable publishers to set their own pricing and licensing terms, according to a Microsoft blog post released on Tuesday. The voluntary marketplace is open to all types of publishers and is designed to give AI developers scaled access to authorised training data.
Microsoft said PCM will also provide publishers with insights into how their content is used for AI training, helping them better understand its value and determine appropriate licensing conditions. The company stressed that publishers will retain ownership of their content as well as full editorial independence.
Microsoft tops Wall Street assumption with $81.3B in revenue
The initiative comes amid growing tensions between publishers and big technology companies over the use of copyrighted material for training large language models. Many AI systems have been developed using vast amounts of online data, including news content, often without explicit permission.
Several publishers have responded with legal action. The New York Times has filed copyright infringement lawsuits against Microsoft and OpenAI, while in India, members of the Digital News Publishers Association (DNPA), including The Indian Express, have challenged OpenAI over what they describe as the unlawful use of copyrighted material. At the same time, some major publishers have signed licensing agreements with AI companies to monetise their content.
Microsoft acknowledged that traditional models of content distribution are being disrupted by the rise of AI-powered search and conversational tools. “The open web was built on an implicit value exchange where publishers made content accessible, and distribution channels like search helped people find it,” the company said, adding that this model does not easily translate to an AI-first environment.
The technology giant said much authoritative content remains behind paywalls or within specialised archives, making sustainable and transparent licensing mechanisms increasingly important as AI adoption grows.
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Microsoft said PCM has been developed in partnership with several US-based publishers, including Vox Media, The Associated Press, Condé Nast and People. To assess the impact of licensed material, the company tested its Copilot AI chatbot using premium content and found that it significantly improved the quality of responses.
The company added that it plans to continue piloting the platform and is looking to onboard additional partners, including Yahoo, in the coming months. #With inputs from Indian Express
7 months ago
Microsoft tops Wall Street assumption with $81.3B in revenue
Microsoft on Wednesday reported revenue of $81.3 billion for the October-December quarter, marking a 17% increase from the same period a year earlier, as the company continues efforts to expand global use of its artificial intelligence tools.
The tech giant posted a net profit of $30.9 billion, or $4.14 per share, for the quarter, exceeding Wall Street expectations. The results did not include the impact of Microsoft’s investments in ChatGPT developer OpenAI.
Analysts surveyed by FactSet Research had projected Microsoft to earn $3.91 per share on revenue of $80.31 billion for the October-December quarter.
When excluding its OpenAI investments, Microsoft’s profit rose to $38.5 billion, or $5.16 per share, reflecting a new accounting approach the company said it plans to apply going forward.
The investments stem from OpenAI’s restructuring last year. Microsoft held an approximately 27% stake, valued at about $135 billion, in OpenAI as the startup originally a nonprofit transitioned into a for-profit public benefit corporation.
Although Microsoft is no longer OpenAI’s exclusive cloud provider, a partnership that helped finance the AI company’s early expansion, it will continue to hold commercial rights to OpenAI products through 2032.
Read More: Microsoft to invest $17.5 billion in India for AI and Cloud infrastructure
Revenue from Microsoft’s AI-driven cloud computing segment totaled $32.9 billion in the final three months of the year, an increase of 29% from the same period last year and above the $32.4 billion forecast by analysts surveyed by FactSet.
Despite surpassing expectations, Microsoft shares fell nearly 5% in after-hours trading following the release of its earnings report.
Zacks Investment Research analyst Bryan Hayes said the decline likely reflected “investor scrutiny” over Microsoft’s heavy spending on the infrastructure including computer chips and data centers required to support artificial intelligence.
Microsoft Chief Executive Officer Satya Nadella told investors during an earnings call that the company remains in the “beginning stages” of AI diffusion, referring to the broader adoption of artificial intelligence across industries.
7 months ago
Microsoft halts digital film and TV sales without warning
Microsoft has abruptly pulled out of the digital movie and TV business, ceasing all sales and rentals through its Movies & TV app without prior notice.
As of Friday, users can no longer buy or rent films and shows via Microsoft.com, the Microsoft Store on Windows, or the Xbox platform.
A support notice on the company’s website states, “Important: Microsoft no longer offers new entertainment content for purchase, including movies and TV shows, on Microsoft.com, Microsoft Store on Windows, and the Microsoft Store on Xbox.”
A similar message also appears on Xbox’s support page.
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No reason was provided for the sudden decision, according to Variety.
Users who have previously purchased digital content can still access it on Windows and Xbox devices. However, Microsoft will not issue refunds. As per the Microsoft Store Terms of Sale, “Movies and TV shows are ineligible for refunds.”
Microsoft’s venture into digital entertainment began in 2006 with its Zune media player. This later evolved into Xbox Video in 2012, before rebranding as Microsoft Movies & TV in 2015.
1 year ago
Microsoft to lay off about 3% of workforce
Microsoft says it is laying off nearly 3% of its entire workforce.
The tech giant didn't disclose the total amount of lost jobs but it will amount to about 6,000 people.
Microsoft employed 228,000 full-time workers as of last June, the last time it reported its annual headcount. About 55% of those workers were in the US, reports AP.
Microsoft said the layoffs will be across all levels and geographies but will focus on reducing management levels. Notices went out on Tuesday.
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Microsoft announced a smaller round of performance-based layoffs in January. But the 3% cuts will be Microsoft's biggest reported layoffs since early 2023, when the company cut 10,000 workers, almost 5% of its workforce, joining other tech companies that were scaling back their pandemic-era expansions.
The latest layoffs come just weeks after Microsoft reported strong sales and profits that beat Wall Street expectations for the January-March quarter, which investors took as a dose of relief during a turbulent time for the tech sector and US economy.
1 year ago
Microsoft and Meta Platforms lead Wall Street higher
Microsoft and Meta Platforms are driving Wall Street higher on Thursday after profits for the Big Tech companies at the start of the year turned out to be even bigger than analysts expected.
The S&P 500 was up 1% and heading for an eighth straight gain, which would be its longest winning streak since August, AP reports.
The Dow Jones Industrial Average was up 248 points, or 0.6%, as of 10:20 a.m. Eastern time, and the Nasdaq composite was 1.8% higher.
Microsoft jumped 9% after the software giant said strength in its cloud computing and artificial intelligence businesses drove its overall revenue up 13% from a year earlier.
Meta, the parent company of Facebook and Instagram, also topped analysts’ targets for revenue and profit in the latest quarter. It said artificial intelligence tools helped boost its advertising revenue, and its stock climbed 5.3%.
CVS Health, Carrier Global and a bevy of other companies also joined the stream of better-than-expected profit reports that have helped steady Wall Street over the last week. The S&P 500 is back to within 8.5% of its record set earlier this year, after briefly dropping nearly 20% below the mark.
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Still, plenty of uncertainty remains about whether President Donald Trump’s trade war will force the economy into a recession. A couple mixed reports on the U.S. economy Thursday followed up on several recent updates that have suggested it's weaker than expected.
One of Thursday's reports said more US workers filed for unemployment benefits last week than economists had forecast, setting the stage for a more comprehensive report on the job market arriving Friday.
A separate update said US manufacturing activity was better last month than economists expected, though it still contracted again.
And even though companies have been reporting better profits for the first three months of the year than analysts expected, many CEOs are remaining cautious about the rest of the year.
1 year ago
Microsoft hits pause on some AI data centre projects, including $1b Ohio site
Microsoft has announced it is “slowing or pausing” certain data centre construction projects, including a $1 billion development in Ohio, amid signals that the surge in demand for artificial intelligence (AI) infrastructure may be levelling off.
The company confirmed it is halting early-phase work on rural sites it owns in Licking County, near Columbus, Ohio. Two of the three properties will now be retained for agricultural use, AP reports.
“In recent years, demand for our cloud and AI services grew more than we could have ever anticipated and to meet this opportunity, we began executing the largest and most ambitious infrastructure scaling project in our history,” said Noelle Walsh, Microsoft’s president of cloud operations, in a LinkedIn post.
Walsh added, “Any significant new endeavour at this size and scale requires agility and refinement as we learn and grow with our customers. What this means is that we are slowing or pausing some early-stage projects.”
While the tech giant has not disclosed details of other affected sites beyond Ohio, it had already paused later phases of a major data centre development in Wisconsin last December.
Earlier this year, analysts at TD Cowen noted Microsoft had been scaling back some international expansion and cancelling data centre leases in the US. Industry watchers have linked these adjustments to shifts in Microsoft’s partnership with OpenAI, the maker of ChatGPT.
Microsoft fires employees protesting AI technology contracts with Israel
“OpenAI was moving in one direction” by focusing on more powerful AI systems requiring vast computing capacity, while “Microsoft may not have been moving that same direction,” said Craig Ellis, research director at B Riley Securities.
In January, Microsoft and OpenAI revised their agreement, which had made Microsoft the exclusive provider of OpenAI’s computing infrastructure. The updated deal allows OpenAI to develop its own capacity, primarily for training and research.
Despite the pause, Microsoft still intends to spend over $80 billion globally on AI infrastructure in this fiscal year, which ends in June. The company says it has already doubled its data centre footprint in the past three years.
“While we may strategically pace our plans, we will continue to grow strongly and allocate investments that stay aligned with business priorities and customer demand,” said Walsh.
The decision disappointed some local officials in Licking County, which has also drawn investment from Google, Meta, and chipmaker Intel — although Intel has delayed its planned factory to 2030.
1 year ago
Microsoft fires employees protesting AI technology contracts with Israel
Microsoft has dismissed two employees who interrupted the company's 50th anniversary event to protest its provision of artificial intelligence technology to the Israeli military, according to a workers' advocacy group.
In a termination letter issued on Monday, Microsoft accused one of the employees of engaging in misconduct "intended to gain attention and create maximum disruption" at the highly anticipated event. The other employee had previously announced her resignation but was instructed to leave five days earlier than planned on Monday.
The protest began on Friday when Microsoft software engineer Ibtihal Aboussad approached the stage where an executive was discussing new product features and Microsoft's long-term AI vision. Aboussad shouted, "You claim that you care about using AI for good, but Microsoft sells AI weapons to the Israeli military. Fifty thousand people have died, and Microsoft powers this genocide in our region," forcing the executive, Mustafa Suleyman, to pause his talk during the livestreamed event from Microsoft's Redmond, Washington campus. The event was attended by co-founder Bill Gates and former CEO Steve Ballmer.
Microsoft said Suleyman attempted to calm the situation, thanking Aboussad for her protest and acknowledging her message. However, Aboussad continued shouting that Suleyman and "all of Microsoft" had blood on their hands. She also threw a keffiyeh scarf, a symbol of support for Palestinians, onto the stage before being escorted out.
A second protester, Vaniya Agrawal, interrupted the event later. Aboussad, who is based at Microsoft's Canadian headquarters in Toronto, was invited to a meeting on Monday with a human resources representative, during which she was informed of her immediate termination, according to the advocacy group No Azure for Apartheid, which has protested Microsoft's Azure cloud services being used by Israel.
Earlier this year, an Associated Press investigation revealed that AI models from Microsoft and OpenAI were used in an Israeli military program to select bombing targets during recent conflicts in Gaza and Lebanon. The report also highlighted a 2023 Israeli airstrike that mistakenly hit a vehicle carrying members of a Lebanese family, killing three young girls and their grandmother.
Microsoft's termination letter to Aboussad stated that she could have raised her concerns privately with a manager but instead made "hostile, unprovoked, and highly inappropriate accusations" against Suleyman and the company. The letter also mentioned that her actions were so disruptive that security had to escort her out.
Agrawal had already submitted her resignation, scheduled for April 11, but on Monday, a manager informed her that her resignation would be effective immediately.
This protest was the most public, but not the first, against Microsoft's work with Israel. In February, five Microsoft employees were removed from a meeting with CEO Satya Nadella for protesting the company’s contracts.
Microsoft issued a statement on Friday, saying, “We provide many avenues for all voices to be heard,” but emphasized that protests should not disrupt business. The company also reiterated its commitment to maintaining high standards in its business practices.
While Microsoft had not commented on additional actions following the protest, both Aboussad and Agrawal noted that they lost access to their work accounts shortly after the incident.
Last year, dozens of Google employees were fired after internal protests regarding a contract with the Israeli government. Employees at Google offices in New York and Sunnyvale, California, had protested the $1.2 billion Project Nimbus, a deal providing AI technology to Israel. The Google workers later filed a complaint with the National Labor Relations Board to try to regain their jobs.
1 year ago