Tech giants divided in reaction to EU AI code as Microsoft signs, Meta rejects

Tech giant Microsoft intends to sign the European Union’s AI code, supporting efforts to implement the bloc’s new rules.

The company’s President, Brad Smith, commented, “I think it’s likely we will sign. We need to read the documents.”

Meta Platforms, however, already dismissed the EU’s guidelines. 

Open AI and Mistral signed the EU AI code

The European Commission released the General-Purpose AI (GPAI) Code of Practice on July 10. It claimed the code would offer legal clarity to signatories and encourage the industry to comply with the AI Act, which was first instituted in 2024.

Signatories of the code are required to provide summaries of their AI training data and adopt measures to comply with EU copyright rules. 

Unlike its counterpart, Meta, Microsoft’s Smith stated that they want to be supportive of the process, adding that they particularly appreciate the AI Office’s direct engagement with the industry. He added that the firm would be open to signing the code of practice.

Companies like OpenAI and Mistral have already signed the code. In contrast, Meta Platforms insisted it would not sign the code, calling it an excessive regulation that would hinder business growth. According to the company’s global affairs chief, Joel Kaplan, Europe is taking the wrong approach to AI, arguing that the code creates legal ambiguities for model developers and imposes requirements that extend well beyond the AI Act.

On the other hand, ASML Holding and Airbus wrote to the EU asking for the code to be put on hold for two years.

Microsoft is investing heavily in artificial intelligence

Microsoft is planning to spend about $80 billion, about £68.6 billion, on data centers to train AI models. However, the company is set to reduce its workforce significantly. The firm will lay off 15,000 workers this year, over 4% of its workforce, most of them from its Xbox video game division. Several game projects have already stalled due to the job cuts, including the Perfect Dark reboot and Everwild.

Some have linked the layoffs to Microsoft’s AI investments and the productivity gains achieved through internal AI use. However, the company told reporters that AI-related efficiency is “not a predominant factor” in the recent job cuts.

Nevertheless, the company asserted that its use of AI tools internally enhanced productivity across sales, customer support, and software development. Chief Commercial Officer Judson Althoff claimed the firm realized over $500 million in call center savings and improved employee and customer satisfaction. The firm also said it will utilize AI for interactions with smaller customers. Moreover, the company is using AI to get new codes for products. About 35% of the code for new products was produced by AI, significantly accelerating product releases. 

Last year, the firm appointed British AI pioneer Mustafa Suleyman to lead its AI operations. It also poured in a sizable investment in OpenAI, the ChatGPT maker,  though recent reports point to increasing tension between the two.

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