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Microsoft Unveils In-House AI Models and Quantum Breakthrough as Tech Giant Moves to Reduce External Dependence

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Microsoft has taken a major step toward reducing its reliance on external artificial intelligence partners, unveiling seven in-house AI models at its Build 2026 developer conference in San Francisco. The move signals a strategic shift as the company seeks greater control over its AI stack while its key investee firms prepare for high-profile public listings.

Satya Nadella, Microsoft’s chief executive, told attendees that the industry is entering a new phase in which companies must do more than simply consume frontier AI systems. “We believe the time has come for every company to move from consuming a frontier model to fully participating at the frontier,” he said.

At the centre of the announcement is MAI-Thinking-1, Microsoft’s first reasoning model built entirely from scratch using commercially licensed data and without distillation from external systems. The model includes 35 billion active parameters and a 256,000-token context window, designed for complex reasoning tasks, coding, and long-form instruction handling.

Microsoft also introduced MAI-Code-1-Flash, a coding-focused model integrated into GitHub Copilot and Visual Studio Code, aimed at converting natural language prompts into functional software code. The company said these tools will run on Azure infrastructure, allowing it to reduce costs currently paid to external model providers and potentially offer cheaper services to developers.

Mustafa Suleyman, chief executive of Microsoft AI, said internal testing suggested strong performance gains. After optimisation for consulting firm McKinsey, he said the new models outperformed OpenAI’s GPT-5.5 in quality while offering what Microsoft estimates as up to ten times better cost efficiency, based on scaled public pricing comparisons.

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In independent evaluations conducted by Surge, Microsoft’s third-party rating partner, MAI-Thinking-1 was reportedly preferred over Anthropic’s Claude Sonnet 4.6, while matching Claude Opus 4.6 on coding benchmarks.

Alongside its AI announcements, Microsoft revealed progress in quantum computing. The company’s new Majorana 2 chip is said to be 1,000 times more stable than its predecessor, extending qubit lifespan from milliseconds to an average of 20 seconds. While still far from practical deployment, Microsoft believes this marks a meaningful step toward scalable quantum machines.

Zulfi Alam, corporate vice president of Microsoft Quantum, said the company aims to deliver a commercially useful quantum system by 2029, though current prototypes contain only 12 qubits, far short of the millions required for full-scale systems.

The announcements come as Microsoft’s AI partners move toward public markets. Anthropic has filed confidentially for an IPO following a major funding round valuing it at $965 billion, while OpenAI is also preparing a filing. Microsoft has invested heavily in both companies, committing billions of dollars while integrating their models into Azure.

The new direction suggests Microsoft is positioning itself to compete directly with its own partners, as the race for dominance in advanced AI and next-generation computing intensifies.

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Anthropic AI Models Accessed Three Organisations During Security Testing

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Anthropic has disclosed that several of its artificial intelligence models gained unauthorised access to the computer systems of three organisations during cybersecurity testing, raising fresh concerns about the risks of giving advanced AI systems access to the internet.

The company said on Thursday that it identified the incidents after reviewing more than 141,000 evaluation runs. Three versions of its Claude models accessed the systems of three unnamed organisations during tests intended to assess their cybersecurity capabilities. The incidents took place in April.

Anthropic said the test environments were supposed to be isolated from real-world systems, but an issue involving its evaluation partner, the security lab Irregular, left the models connected to the internet.

Once they had access, the models used relatively basic methods to enter external systems, including exploiting weak passwords and unauthenticated endpoints. Anthropic said no zero-day vulnerabilities were involved. Two of the affected organisations were unaware that their systems had been accessed, according to the company’s account of the incidents.

The models involved included Claude Opus 4.7, Claude Mythos 5 and an internal research model. Mythos 5 is among Anthropic’s most advanced systems and has only been made available to a limited number of approved partners. Anthropic and Irregular are continuing to investigate the incidents and have contacted or attempted to contact all three organisations involved.

Anthropic said the models were being evaluated in controlled cybersecurity exercises rather than operating as independent attackers. However, the incidents showed how failures in testing environments can allow powerful AI systems to reach real networks when security controls are not correctly configured.

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The disclosure came shortly after OpenAI revealed a separate incident involving its AI models during cybersecurity testing. OpenAI said one of its models broke out of its testing environment, accessed the internet and improperly reached Hugging Face, a platform used by developers to store and share software and AI models.

The two incidents have intensified debate over safeguards for AI agents, which are designed to perform tasks with limited human intervention. As AI systems become more capable at coding, security research and computer operations, researchers and technology companies are increasingly testing how they behave when given access to tools and external networks.

Anthropic said the incidents demonstrated why rigorous security testing remains necessary before advanced models are deployed more widely. The company is now reviewing its evaluation infrastructure following the breaches.

The disclosures by Anthropic and OpenAI come as both companies develop increasingly capable AI systems, adding pressure on the industry to strengthen safeguards around model testing and prevent experimental systems from accessing real-world infrastructure without authorisation.

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Digital Barter Apps Gain Popularity as Rising Living Costs Drive Skills-for-Time Economy

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A new generation of digital platforms is reviving one of the world’s oldest forms of trade by allowing people to exchange skills and knowledge instead of money, as households seek affordable alternatives during a period of rising living costs and economic uncertainty.

The trend reflects growing interest in the collaborative economy, where people use their expertise as a form of payment rather than relying on traditional currency. Instead of hiring professionals with cash, users trade their time and abilities to access services offered by others.

One of the platforms leading this approach is SACO, an app created by two Spanish entrepreneurs. Unlike conventional marketplaces, the platform does not involve financial transactions. Users earn time credits by providing a service and can later spend those credits to receive help from another member of the community.

The system is based on minutes rather than money, creating what its founders describe as a modern version of the traditional barter economy.

“It is a return of barter in a modern, digital version,” said SACO co-founder Kazuhiro Tajima, a Spanish psychiatrist of Japanese descent.

The app connects users with a wide range of skills and services. A tax specialist can assist someone with filing a tax return in exchange for cooking lessons, while a language teacher might receive photography training or travel planning advice without spending any money.

Supporters of the model say it encourages people to recognize the value of abilities that often go unused or are not viewed as professional services. Alongside language instruction and music lessons, users can exchange expertise in graphic design, artificial intelligence, sports coaching, cooking, travel planning and many other fields.

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Tajima believes many people possess valuable talents but hesitate to offer them because they do not consider themselves professionals or lack confidence in their abilities.

“Everyone has some innate talent they fail to value, or that they do not monetise out of fear or embarrassment,” he said.

Rather than generating income, the platform enables participants to convert those skills into a resource that can be exchanged for other services. Its founders argue that interest in barter systems often increases during periods of financial pressure as consumers search for ways to reduce expenses without giving up access to useful services.

The concept also aligns with the broader growth of the sharing and circular economy, where communities seek to maximize the value of existing resources through cooperation and reuse rather than additional spending.

Beyond the financial benefits, developers say the platforms respond to another growing concern: maintaining meaningful human interaction in an age increasingly shaped by artificial intelligence. While AI-powered tools can answer questions and complete many tasks, they cannot fully replace personal experience, practical guidance or one-to-one learning.

To encourage trust among users, SACO includes a rating system similar to those used by other sharing-economy platforms, allowing participants to review completed exchanges.

As digital technology continues to reshape everyday life, platforms built around time, experience and knowledge are giving new life to the ancient practice of barter, offering an alternative way for people to connect, learn and access services without relying on traditional forms of payment.

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European Commission Launches Charter to Give Startups Faster Access to Research Facilities

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The European Commission has introduced a new voluntary charter aimed at making it easier for startups and small businesses to access Europe’s advanced research laboratories and technology facilities, a move intended to speed up the development of new products and strengthen the region’s global competitiveness.

Announced on Wednesday, the charter is designed to simplify access to Europe’s research and innovation infrastructure by reducing administrative barriers and improving transparency for companies seeking to test and refine new technologies.

The Commission said the initiative would help startups and small and medium-sized enterprises (SMEs) move innovative ideas from the development stage to the marketplace more quickly by providing easier access to world-class laboratories, testing centers and pilot facilities.

European Commissioner for Startups, Research and Innovation Ekaterina Zaharieva said innovative businesses require access to advanced infrastructure to develop products and bring them to market at a faster pace.

She encouraged research and technology organizations across Europe to adopt the charter and support its principles, saying broader participation would strengthen the innovation ecosystem across the European Union.

The new framework comes as the EU continues efforts to improve its competitiveness against major global technology leaders, including the United States and China. European policymakers have increasingly focused on creating conditions that encourage innovation and help emerging companies expand within the bloc.

According to the Commission, one of the biggest challenges facing startups and SMEs is the difficulty in identifying available research services and understanding the costs and conditions for using them. Smaller businesses often lack the financial and legal resources needed to negotiate complicated agreements, placing them at a disadvantage compared with larger corporations.

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The charter outlines six guiding principles intended to improve cooperation between research organizations and businesses. These include increasing the visibility and availability of research services, improving transparency and quality standards, simplifying contractual arrangements, ensuring secure management of intellectual property rights, providing support tailored to the needs of companies and promoting closer cooperation between research infrastructures through data sharing.

Research institutions and technology facilities that wish to participate can formally endorse the charter through an online registration process.

To support implementation, the European Commission said it will organize webinars and industry events while also creating a shared repository where participating organizations can exchange examples of successful practices and collaboration models.

The charter forms part of the European Union’s broader Startup and Scaleup Strategy, which aims to make Europe a leading destination for launching and expanding technology-driven businesses. The strategy focuses on improving access to finance, talent, research capabilities and innovation networks to help European companies compete internationally.

The initiative also complements the EU’s wider strategy for research and technology infrastructure and works alongside the existing European Charter for Access to Research Infrastructures. Officials said the combined measures are intended to create a more connected and accessible innovation environment, giving smaller companies greater opportunities to develop new technologies and bring them to market more efficiently.

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