Ex-Microsoft Executive Says Copilot Adoption Is Far Lower Than Expected

A former Microsoft executive has publicly criticized the company’s AI strategy, arguing that Microsoft “missed the AI wave” despite investing heavily in Copilot, Bing AI, and AI-powered Windows features.

According to comments highlighted by Windows Latest, former Microsoft technical fellow Mat Velloso believes the company now needs what he described as an internal “factory reset” as pressure grows from weak Copilot adoption, expensive AI infrastructure, and rising competition from OpenAI.

Copilot adoption remains surprisingly small

One of the biggest criticisms centers around Microsoft Copilot adoption.

Velloso claims fewer than 3% of paying users actively use Copilot products. Microsoft reportedly has around 450 million Microsoft 365 users, but only about 15 million paid Copilot seats. That translates to roughly 3.3% adoption despite Microsoft integrating Copilot deeply into Windows 11, Microsoft 365 apps, Edge, and the Windows taskbar.

The criticism reflects growing concerns that Microsoft’s aggressive AI rollout is not translating into meaningful daily usage from mainstream consumers or enterprise customers.

Microsoft has continued adding Copilot across nearly every major product category, including Windows PCs, Office apps, Teams, and developer services. However, many users still treat Copilot as an optional feature rather than a core productivity tool.

Bing AI still failed to seriously challenge Google

Velloso also criticized Microsoft’s Bing AI strategy. Microsoft invested billions into OpenAI partnerships and quickly integrated generative AI into Bing search. The company hoped AI-powered search experiences would finally help Bing gain market share against Google.

According to Velloso, that never happened at a meaningful scale. He argues Bing failed to gain even one full percentage point of search market share despite Microsoft’s aggressive AI push and major marketing campaigns around AI search experiences.

The criticism suggests Microsoft’s AI integrations generated attention without fundamentally changing user behavior.

AI PCs and NPUs face a real-world problem

Another major point involves AI hardware and Windows 11 AI PCs. Microsoft strongly encouraged OEM partners to build laptops with dedicated NPUs, or neural processing units, to support upcoming AI features in Windows 11. Companies heavily promoted Copilot+ PCs and AI-ready hardware throughout 2025 and 2026.

Velloso argues consumers still do not see enough practical value from NPUs because Windows and Office lack compelling everyday AI workloads that truly require dedicated hardware acceleration.

The criticism highlights a growing concern across the PC industry: hardware makers invested heavily in AI-focused devices before users fully understood why they needed them.

GitHub reliability and AI infrastructure pressure

Velloso also criticized GitHub reliability and broader infrastructure issues tied to Microsoft’s expanding AI ecosystem.

The report suggests rising AI infrastructure costs combined with weaker-than-expected adoption are forcing Microsoft to rethink parts of its strategy and pay closer attention to customer feedback.

Running large-scale AI systems requires enormous GPU capacity and datacenter spending. That pressure becomes more visible if enterprise customers fail to adopt premium AI subscriptions at the scale Microsoft expected.

OpenAI is becoming a direct enterprise competitor

The former executive also warned that OpenAI is evolving from a Microsoft partner into a serious enterprise threat.

OpenAI recently launched its OpenAI Deployment Company initiative, backed by more than $4 billion. The program sends deployed engineers directly into Fortune 500 companies to help build custom AI solutions.

That approach overlaps with Microsoft’s traditional enterprise model built around Azure, consulting relationships, and long-term enterprise software integrations.

The shift creates an unusual situation where Microsoft simultaneously depends on OpenAI technology while also competing against OpenAI for enterprise AI customers.

Microsoft still has enormous enterprise strength

Despite the criticism, Velloso does not believe Microsoft is collapsing.

He argues the company still has one of the strongest enterprise moats in technology because businesses remain deeply dependent on products like Windows, Microsoft 365, Azure, Active Directory, and decades-old enterprise integrations.

Microsoft has also recently shifted more attention back toward improving core Windows 11 experiences instead of focusing entirely on AI features.

The company recently introduced initiatives like its Driver Quality Initiative and additional WinUI 3 improvements aimed at stability and software quality.

Microsoft is also bringing back several long-requested Windows features, including movable taskbars and additional taskbar size options, signaling renewed focus on basic usability improvements alongside AI development.