AI Judge changed title after evaluation, original title: "Microsoft evaluates DeepSeek to cut Copilot inference costs ahead of shift to usage-based pricing"
Microsoft is weighing a fine-tuned DeepSeek model, hosted entirely on Azure, as an optional lower-cost engine for Copilot Cowork while preparing to bill customers by actual usage instead of flat rates. Heavy users running hundreds of tasks weekly have made unlimited pricing unsustainable, so the company is testing efficiency gains from DeepSeek's sparse attention design and has already added bias-reduction safeguards.
BIG This is what happens when u have SOTA attention mechanism & cache hit rate Btw, DeepSeek is already testing v4.1 in the web app Drop will happen soon LFG!!!
Microsoft is moving Copilot Cowork to usage-based pricing and is considering a Microsoft-hosted version of DeepSeek as a cheaper option (@inafried / Axios)
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GitHub Copilot already switched to token-based credits on June 1, and the same logic is coming to Copilot Cowork. The shift surfaces real inference costs that flat pricing once hid, pushing Microsoft toward any model that can deliver acceptable quality at lower compute spend.
A final model pick, performance numbers, and customer rollout details remain unannounced. The company has signaled a multi-model approach rather than any single replacement, and it has not yet addressed potential pushback over using a model from a Chinese lab.
Positive users praise Microsoft's plan to host DeepSeek as a cheaper Copilot alternative to OpenAI for its cost savings and open-source appeal, while negative users call the move dumb or a risky increase in reliance on Chinese AI.
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Microsoft has fine-tuned a version of DeepSeek and is considering it as a lower-cost alternative to OpenAI and Anthropic models for Copilot Cowork. Huge development considering the history of the OpenAI/MS relationship.
New @axios: Microsoft eyes DeepSeek for Copilot Cowork as it also joins the shift to usage based pricing. Says final decision TK but it has already fine-tuned a model that it could use.
Wild!
Just by saying this out loud Microsoft has hurt the potential IPOs of both OpenAI and Anthropic.
BREAKING: Microsoft exploring DeepSeek over OpenAI and Anthropic as Copilot Cowork moves to usage-based pricing
“We have users who do hundreds of tasks a week… the consequence is the costs can go very high...”
Jevons paradox
Axios reports that Microsoft is considering a Microsoft-hosted version of DeepSeek V4 as a cheaper model option for Copilot Cowork.
Microsoft says Copilot Cowork can’t work on unlimited pricing.
“We have users who do hundreds of tasks a week… but the consequence is the costs can go very high,” Charles Lamanna told Axios.
So Microsoft is moving Copilot Cowork to usage-based pricing, and exploring cheaper open-source model options.
If Microsoft really goes with DeepSeek, it would be optional, fine-tuned, safeguarded, and hosted fully on Azure.
Still: Microsoft adding a Chinese AI model to an enterprise Copilot product would be huge.
New @axios: Microsoft eyes DeepSeek for Copilot Cowork as it also joins the shift to usage based pricing. Says final decision TK but it has already fine-tuned a model that it could use.
The funny thing is that most enterprises globally use Copilot (which is shit) If the finetuned DeepSeek v4 is good, then the surface area for the whale is about to explode
BIG This is what happens when u have SOTA attention mechanism & cache hit rate Btw, DeepSeek is already testing v4.1 in the web app Drop will happen soon LFG!!!
Open Source has entered the group chat
Microsoft eyes DeepSeek for enterprise AI https://www.axios.com/2026/06/16/microsoft-copilot-cowork-tokenmaxxing-cowork?utm_campaign=mrf-utm_campaign=editorial&utm_source=x&utm_medium=owned_social&utm_source=twitter&utm_medium=social&mrfcid=202606166a263e4129cdae05be98d7fe
@AndrewCurran_ If they offered it directly instead of copilot people might even use it!
Microsoft has fine-tuned a version of DeepSeek and is considering it as a lower-cost alternative to OpenAI and Anthropic models for Copilot Cowork. Huge development considering the history of the OpenAI/MS relationship.
@kimmonismus You can already deploy Deepseek models through azure, I have multiple deployments of Deepseek v4 pro & flash.
@zephyr_z9 Is it really that exciting?
@Midnight_Captl I urge u to try DeepSeek APi + Hermes agent It's super fun to use and extremely cheap U can burn billions of tokens
@ns123abc They should use a Budgeting strategy (ironically one product could help with that is called Pichay which looks like the Google CEO's name)
@zephyr_z9 Microsoft is never going to call it deep seek
They'll make a slight change and put their name on it
@ns123abc Or just hire the right people to make your product good? Or did microslop give up on that?
@ns123abc Microsoft pivoting to usage-based pricing for Copilot? Guess they realized AI can be just as cost-prohibitive as their licenses.
@Jason Good. We need FOSS models to win. I’m tired of OAI narcissism and Anthros pickme drama queen behavior.
@kimmonismus Then I will just stop using copilot completely.
@zephyr_z9 I trust you bro. Will try 👍
@ns123abc That would be a reason to switch to copilot
@Jason IBM should make an open-source LLM.
@ns123abc Would absolutely dump everything Microsoft if that happens.
@kimmonismus Crazy to think they can't get a better deal from the model providers wtf