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Microsoft and others rethink AI use, cost rising fast and no productivity gains
AI was supposed to save money. But as AI meets messy realities of work, tech companies are...
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Handcrafted By
Our Editors
Microsoft and others rethink AI use, cost rising fast and no productivity gains
AI was supposed to save money. But as AI meets messy realities of work, tech companies are curbing their enthusiasm. Microsoft is now going easy on Claude due to its cost, while Uber has in just 5 months exhausted its entire AI budget for 2026.
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The promise that AI would cut operational costs is running into a big reality check. (Image created using AI by Divya Bhati)
Divya Bhati
New Delhi
UPDATED:
May 26, 2026 15:46 IST
The promise of AI in 2025 was simple: adopt it and you will save on operational cost. This would be due to two reasons. One, AI will cost less than what a company has to pay to a human employee. And two, AI will boost productivity by 10X or something like that.
The reality of AI in 2026 is simple. Instead of productivity going up by 10X it is the cost of AI that has risen up sharply. Some industry insiders have even started suggesting that it is cheaper to pay for a competent human employee instead of deploying Claude. The cost question around AI has become so stark that even companies like Microsoft and Uber are finding it difficult to justify their AI expenses.
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Last week a few reports highlighted the supposed misalignment in AI benefits and costs that companies have started to notice. At
Microsoft, the management
has asked thousands of engineers to stop using Claude Code and instead move to an internal AI tool. The deadline to do so is June 30. While the company has not publicly commented on the reason why just months after pushing Claude Code on its employees it is moving away from the Anthropic tool, reports suggest it is because of the money employees are burning on Claude tokens, the expense that is not, at least for now, visible in productivity gains.
India Today Tech has reached out to Microsoft for a comment and we will update the copy when we get one.
At the same ti
采集时间: 2026-05-26 20:16:36
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