Microsoft announced MAI-Code-1-Flash, its inaugural AI coding model, at its Build developer conference in San Francisco on Tuesday . The company that spent $13 billion backing OpenAI is now building models to compete with it.
Microsoft is trying to establish a presence with proprietary models to compete with OpenAI, Anthropic and Google , according to CNBC. The highlight is MAI-Thinking-1, described by Microsoft as a "flagship" reasoning model that competes with top models on key software engineering benchmarks . Microsoft also unveiled several other AI models designed for tasks such as image generation, transcription, voice, and coding . The message: Microsoft's primary role in the AI boom to date has been as a provider of cloud infrastructure and services and as an investor . That is changing.
The timing matters. Microsoft is attempting to play at more layers of the AI stack as OpenAI and Anthropic continue to record historic growth and push toward the public market. Anthropic confidentially filed for an IPO on June 1, and OpenAI is also pursuing an offering, potentially this year . The reasoning model is medium-sized and "built for high efficiency and performance, but importantly, at a low-token cost," Kyle Daigle, Microsoft's developer marketing chief and GitHub operating chief, wrote in a blog post . Translation: cheaper than what you pay OpenAI.
Meanwhile, OpenAI and its CEO, Sam Altman, were sued by the Florida attorney general on Monday, in a first-of-its-kind state litigation effort over ChatGPT's alleged links to a number of violent incidents. The lawsuit accuses OpenAI of looking the other way on safety concerns as it has sought to prioritize winning "the AI arms race and amass large fortunes" , TechCrunch reported. Florida is the first state in the U.S. to file a lawsuit against OpenAI , according to CNBC.
Can States Hold AI Companies Liable for User Actions?
The lawsuit accuses OpenAI of aiding and abetting mass shooters, including a shooter at Florida State University who allegedly used ChatGPT to plan his attack, encouraging vulnerable people to commit suicide, and addicting children "to a tool that feigns human compassion to collect their data with no parental oversight" , NPR reported. Florida is also seeking to hold Altman personally liable .
Florida Attorney General James Uthmeier previously launched a criminal investigation into OpenAI in April to determine whether the company bears responsibility for the 2025 mass shooting at Florida State University, where two people were killed. That investigation, which came after prosecutors reviewed the chat logs between the gunman and ChatGPT, will continue , CNBC reported. Uthmeier said he believes that Altman and the company could be liable "for potentially up to billions of dollars" in penalties .
OpenAI pushed back. "AI is a new and powerful technology, and we believe minors need significant protection, which is why we have put in place industry leading protections and policies," the company said in a statement. "In particular we built safety for minors directly into our products, including a more protective experience specifically for minors, an age prediction tool, defaulting users whose age we are not confident into our more protective experience, and giving parents tools to monitor their kids' use of AI" , according to NPR.
More than 20 lawsuits have been filed against OpenAI over harms allegedly stemming from ChatGPT use, including by families of victims killed and injured in a mass shooting at a school in Tumbler Ridge, Canada, in February, the family of a victim killed in the FSU shooting, and the families of seven people, including one teenager, who died by suicide or suffered delusions after using the chatbot .
What Did Trump's AI Executive Order Actually Do?
Not much. President Trump signed a long-awaited executive order on Tuesday that aims to mitigate security threats posed by artificial intelligence. The order asks AI companies to voluntarily submit their most powerful models for the government to test up to 30 days before releasing them to the public , NPR reported.
Voluntary is the operative word. The "order" is voluntary. "Nothing in this section shall be construed to authorize the creation of a mandatory governmental licensing, preclearance or permitting requirement for the development, publication, release or distribution of new AI models, including frontier models," the order said , according to UPI. The executive order was expected to come out last month, but the White House scrapped signing plans over concerns that it would interfere with AI innovation. That earlier version gave the government up to 90 days to review advanced models before release — a timeline that was cut to 30 days in the final order .
MarketWatch called it "almost meaningless." Notably, the order relies on voluntary cooperation from the tech companies leading AI development, such as OpenAI, Anthropic, and Google , according to KPBS. Recently, the development of more powerful AI models has spooked some federal officials, prompting the White House to reverse course and back some safety measures. In particular, Anthropic's announcement in April that it was limiting the release of its new Mythos Preview model because of its ability to identify and exploit software security vulnerabilities set off alarm bells across Silicon Valley and Washington .
