Satya Nadella on the AI Doomer Slowdown, Microsoft’s Master Plan & Who Wins AI

He has generated $250 billion with a B in market value for Microsoft. Dati Nadella, chairman and CEO of Microsoft.

Since you've been the CEO three and a half years, the stock is up about, I guess it's about 120%.

I'm good for my 80 billion. I'm going to spend $80 billion building out Azure.

Maybe after the industrial revolution, this is the biggest thing. That's our goal with our frontier model.

Our model should be the best model that they can use as a base.

We create technology so that others can create more technology. That's who we are. We're a tool maker.

Please welcome Satya Nadella. All right.

Hi, guys. Good to see you. Thanks for coming out. Good to see you.

Good morning, guys. How are you? Good. Thanks for joining us.

Crazy weekend, but here we are. Do we need to pace the frontier?

So let's start with the common sense part

first, which is we should do what it takes to build stuff that serves humanity first and is in human control.

You know, it's kind of crazy that we have to start with that level of common sense, but I think it's a good place.

then when I think about pacing whatever

the first thing that at least I believe

is the broad diffusion of this technology

is the most critical thing because the benefits

of this tech showing up everywhere

is really what's all about right so at

the end of the day if you sort of say serving humanity let it actually reach humanity in ways that it serves humanity and that means you've got

to have choice, you have to have competition, you have to have all kinds of business models, whether they're open weights, close weights, what have you.

Then the other aspect I think that

is not talked about when we talk about control is

actually the control that, for example, customers have, enterprises or businesses have around this technology, because sometimes this is so opaque, I want my privacy.

I want to be able to embed my knowledge in a set of weights I control.

I want to see all of the COT that's being generated.

I want to use it to do fine-tuning of my own models. My IP shouldn't leak.

So there's an entire body of things that nobody's talking about as much, which is, I really want to make sure that this tech is in my control.

then we get to what is, I think, a real issue of safety.

And we should take it seriously, which is we should take all the time we want to test things.

In fact, I love this idea of having third-party testers. Wow, I grew up in a company that's always done testing.

So it's novel that we should say, wow, they're having embedded third-party testers. Why not? It's a great idea.

In fact, the only thing I would say is we should avoid these cozy arrangements of who is testing what, who has access to what, and it should be broad.

Were you surprised, though, then, when both the SA landed and then it seemed like there was a circling of the wagons amongst the frontier companies?

I think that it comes, my suspicion is it comes genuinely from this place where when you start seeing, in fact, it's fascinating, right?

When you start seeing reward hacking and what's happening in these environments, right, with these agent swarms, there is the mundane.

There is some DevOps error where somebody misconfigured a container. Right, right. Or these API keys.

Or an API key. So, yeah, exactly. There's no monitoring. There's internet access. There's sort of classic, I'll call it basic DevOps.

And then there is real novel new stuff, right, which is what is this reward hacking

that, you know, with these persistent agents and so on. And that's a place where I'll admit that the science is not there.

It's, I thought Jakob's post, which is a good one, which he said, he called it, we're growing intelligence, not building intelligence.

So it's an experimental science. And so the more experimental a science is,

then you really need to make sure you're doing those experiments in controlled environments.

If anything, the place where I would love is taking even the hugging face incident in other places, more transparency on what would it take.

In fact, one of the fascinating things right now is the insider risk. I mean, think about it, right?

If you're sitting in an enterprise, this is all test time compute, by the way, right? So it's not like, oh, it's going to only happen when in some training run.

It can happen for a very mundane task that I give one of these frontier models inside an enterprise where I say, you know, I was telling David this.