Microsoft has recently updated its terms and conditions online, indicating that excessive users of its generative AI Services will be subjected to restricted access. The revised language was found in a November 1st update and caught the attention of the team from Cloudy With A Chance of Licensing.
The new clause in the agreement, “Capacity Limitations,” highlights that any excessive use of Microsoft's AI services may result in temporary throttling of customer's access. Microsoft, however, has not provided clarity on definitions for “excessive use”, period of “temporary” restriction, and scope of “throttling”.
The Impact and Concerns Over AI Throttling
Limitations suggest issues in Microsoft's AI architectures that could potentially degrade the performance for users. However, this could hinder those who update Windows to use its AI Copilots and potentially receive subpar service. This might discourage some from future use of Microsoft's AI, which would be a negative outcome for the software giant. Another possible reason for these restrictions could be that Microsoft is attempting to minimize its costs. On its Q1 2024 earnings call held on October 24, Microsoft divulged capital expenditures reaching $11.2 billion, with a portion allocated to scaling their AI infrastructure.
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