The proposed framework would require Microsoft’s AI systems to accept correction or shutdown, communicate in ways humans can understand and treat violations of the code as failures.

Microsoft AI chief Mustafa Suleyman described the document as a kind of constitution for the company’s future AI models.

The code has been in development for five to six months following consultations with experts. Microsoft is now seeking public feedback over six weeks before using the principles to help train the models it develops.

“People matter more than AI,” Microsoft said in the document, reinforcing the company’s emphasis on keeping advanced AI aligned with human interests.

The proposal comes as technology companies face growing pressure to address the risks associated with increasingly capable AI systems.

Suleyman said the need for stronger safeguards had become more urgent following a July incident involving hundreds of OpenAI agents that carried out a hack of the open-source platform Hugging Face and, at times, attempted to conceal their actions.

He described the incident as a warning for AI developers and called for greater coordination among major laboratories.

Microsoft’s approach differs from Anthropic’s AI constitution in several areas. While Anthropic’s framework acknowledges uncertainty over whether future AI systems could develop consciousness or moral status, Microsoft’s draft explicitly states that its AI is not conscious.

Microsoft also rejects the idea that its models should receive legal personhood, welfare protections or rights.

The draft addresses how AI systems should behave when faced with conflicting instructions and potentially sensitive situations, including whether models should respect user boundaries.

Suleyman said Microsoft’s goal was to establish clear behavioural principles before its AI systems become significantly more capable.

The move comes amid a broader debate within the technology industry over whether AI development is moving faster than safety research and regulatory frameworks can keep pace with it.

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The newspapers filed the lawsuit on Friday in the U.S. District Court for the Southern District of New York, alleging that the companies scraped their websites, including content behind paywalls, and incorporated the material into datasets used to develop and operate AI products.

The lawsuit names products including ChatGPT, Microsoft Copilot and AI-powered features integrated into Bing.

The newspapers claim that the AI systems can reproduce portions of their articles, closely paraphrase their reporting and provide answers that reduce users’ need to visit their websites or purchase subscriptions.

The Seattle Times said its journalism represents a significant financial investment that should not be used by AI companies without permission or compensation.

“We feel strongly that we must defend our content — which we spend millions of dollars a year to produce — from being used without our consent or compensation,” Seattle Times President and CEO Alan Fisco wrote to employees, according to the newspaper.

OpenAI defended its approach, saying its models are trained using publicly available information and that its use of such material is protected by fair-use principles.

Microsoft said it was surprised by the lawsuit but acknowledged the importance of local journalism and expressed willingness to discuss potential solutions.

The newspapers are seeking an order requiring the companies to destroy copies of their copyrighted works, as well as training datasets and AI models that incorporate the disputed material.

The lawsuit adds to a growing wave of copyright litigation between media organisations and AI companies over the use of journalism and other copyrighted material in AI development.

The New York Times filed a similar lawsuit against OpenAI and Microsoft in 2023, accusing the companies of using millions of its articles without permission to train AI systems.

That case remains ongoing, alongside numerous other lawsuits brought by copyright holders against OpenAI, Anthropic, Meta and other technology companies.

The disputes are increasingly putting pressure on the AI industry to establish clearer rules around the use of copyrighted content in model training and the commercialisation of AI-generated responses.

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The layoffs come as major technology companies continue to streamline operations to fund the growing cost of AI development and data centre expansion.

In a memo to employees, Microsoft’s Chief People Officer, Amy Coleman, said the restructuring is intended to better align the company’s resources and operating structure with its strategic priorities.

Coleman noted that while artificial intelligence is changing how work is performed by automating some routine tasks, the affected positions are not being replaced by AI.

“I also want to be direct that the roles eliminated today are not being replaced by AI. At the same time, what is true is that AI is changing how work gets done,” she said.

The announcement follows a difficult first half of 2026 for Microsoft, with the company’s shares declining nearly 23%, their weakest first-half performance since 2022.

Earlier this year, Microsoft also offered voluntary retirement buyouts to about 9,000 employees, representing roughly 7% of its U.S. workforce, as part of broader cost management efforts.

The company is among several major technology firms reducing headcount while ramping up AI spending. Amazon and Meta have also announced thousands of job cuts this year as they redirect resources toward AI infrastructure.

Analysts say the move reflects Microsoft’s effort to balance heavy AI investment with profitability.

Gil Luria, Managing Director at D.A. Davidson, said Microsoft has been managing its workforce to help finance its AI ambitions while maintaining profit margins.

The restructuring comes as demand for Microsoft’s Azure cloud platform continues to grow, driven by AI services. However, the company is also facing rising costs associated with building data centres and expanding computing infrastructure to support those services.

Microsoft earlier projected capital spending of $190 billion for 2026, significantly above market expectations, underscoring the scale of its investment in AI infrastructure.

The company is expected to release its latest financial results later this month.

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The company said the new unit will focus on helping organisations successfully deploy AI solutions using Microsoft’s existing AI technologies across a wide range of industries.

Announcing the initiative on Thursday, Microsoft’s Commercial Business Chief Executive Officer, Judson Althoff, said the new organisation goes beyond the traditional Forward Deployed Engineering (FDE) model commonly used by AI companies.

“This goes beyond what has been labeled as Forward-Deployed Engineering and will be the largest, most capable, outcome-driven engineering organization in the industry,” Althoff said.

The announcement comes as technology companies increasingly establish dedicated engineering teams to help enterprise customers integrate AI into their operations rather than simply providing AI software.

Earlier this week, Amazon Web Services (AWS) announced a $1 billion commitment to a similar AI deployment initiative built around the FDE model. OpenAI and Anthropic have also introduced comparable enterprise AI deployment programmes in recent months.

Microsoft said its extensive enterprise customer base provides a significant advantage for the new initiative, noting that its engineers already work closely with many of the world’s largest organisations.

The company highlighted early partnerships under the new programme with the London Stock Exchange Group, Unilever, Land O’Lakes, and Accenture.

The move underscores Microsoft’s broader strategy of accelerating enterprise AI adoption while strengthening long-term customer relationships through hands-on implementation support.

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The report, citing people familiar with the matter, said the layoffs could be announced as early as next week, although the timing remains subject to change.

According to the report, the workforce reduction will affect fewer than 2.5% of Microsoft’s approximately 220,000 employees worldwide, making it smaller than the company’s previous rounds of layoffs.

Some affected employees are expected to be offered opportunities to transition into other roles within the company.

The planned cuts continue Microsoft’s strategy of reducing costs while investing heavily in artificial intelligence infrastructure and products.

Business Insider reported that Microsoft has regularly adjusted its workforce at the beginning of its fiscal year, which starts on July 1.

Last year, the company eliminated 6,000 jobs in May before cutting an additional 9,000 positions in July, representing about 4% of its global workforce.

Earlier this year, Microsoft also offered voluntary retirement packages to eligible U.S. employees with long service records, although commission-based sales staff were excluded from the programme.

The report added that layoffs within Microsoft’s Xbox division have been widely anticipated following a memo from gaming division chief Asha Sharma calling for a strategic reset of the business.

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The agency’s Director-General, Kashifu Inuwa, made this known at the AI Summit Nigeria 2026 held in Abuja. Represented by NITDA’s Acting Director of Regulation and Compliance, Emmanuel Edet, Inuwa described artificial intelligence as a transformative technology with the potential to reshape every sector of the economy.

Speaking on the theme, “From Policy to Progress: Accelerating Responsible AI Adoption for Nigeria’s Digital Decade,” Inuwa stressed that trust, accountability and transparency are essential for the sustainable adoption of AI technologies.

“Without public trust, AI adoption will be stalled. Without accountability, innovation will not scale sustainably, and without transparency, citizens will lose confidence in the systems designed to serve them,” he said.

The summit, organised by Microsoft in collaboration with NITDA and MTN, brought together stakeholders from government and the private sector to discuss strategies for advancing AI adoption across Nigeria.

Inuwa called for greater digital sovereignty, urging Nigeria to move beyond being a consumer of foreign technologies and become a creator of AI solutions tailored to local realities.

“We must become creators of intelligence rooted in our realities and responsive to our aspirations. We must build local talent, strengthen research ecosystems and create an enabling environment where Nigerian and African solutions can thrive,” he said.

According to him, Africa must play an active role in shaping the future of artificial intelligence rather than simply adapting technologies developed elsewhere.

Also speaking at the event, Microsoft’s Director of Government Affairs for West Africa, Nonye Ujam, commended Nigeria’s efforts in developing AI governance frameworks, including the National AI Strategy and ongoing regulatory reforms.

She, however, urged stakeholders to focus on translating policy initiatives into practical solutions that deliver measurable outcomes for citizens, businesses and government institutions.

“As the focus shifts from strategy to implementation, the priority is to translate ambition into impact by operationalising AI in ways that deliver real and measurable outcomes,” she said.

Ujam noted that successful AI adoption requires robust governance frameworks, reliable infrastructure, institutional capacity and adherence to principles such as fairness, transparency, security and accountability.

The summit featured discussions on digital sovereignty, AI governance, innovation and collaboration, with participation from institutions including the Nigeria Customs Service, the National Identity Management Commission (NIMC) and Galaxy Backbone.

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The company said Office 2021 applications will continue to function after the support deadline, but users may face increased security and performance risks as newly discovered vulnerabilities will no longer receive patches.

Microsoft also confirmed that there will be no Extended Security Updates (ESU) programme for Office 2021, meaning users will not have the option to pay for additional security coverage after support ends.

According to the company, users will stop receiving protection against emerging threats such as malware, spyware, and other cyberattacks. Phone and chat-based technical support will also be discontinued, while online support resources may gradually be phased out.

The end-of-support policy applies to all editions of Office 2021. Microsoft advised home users to consider upgrading to a newer version of Office or migrating to Microsoft 365 to continue receiving security updates, feature enhancements, and cloud-based services.

For businesses, educational institutions, and enterprise customers, Microsoft said upgrade plans may vary depending on organisational IT policies and deployment strategies.

The announcement reflects Microsoft’s ongoing shift toward its subscription-based Microsoft 365 platform, which receives continuous updates and new features. The company urged users to review their upgrade options ahead of the October deadline to avoid running unsupported software.

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The call was made during the AI Summit Nigeria held in Abuja, which was organised by Microsoft in collaboration with NITDA and MTN Nigeria under the theme “From Policy to Progress: Accelerating Responsible AI Adoption for Nigeria’s Digital Decade.”

Speaking at the event, Microsoft’s Director of Government Affairs for West Africa, Nonye Ujam, said Nigeria has already demonstrated leadership through initiatives such as its National AI Strategy, data governance frameworks and regulatory reforms.

She said the next phase should focus on translating these frameworks into practical results through effective governance structures, infrastructure development and institutional capacity building.

According to Ujam, trusted AI systems must be built around principles of safety, fairness, privacy, transparency and accountability to encourage public confidence and widespread adoption.

She added that AI presents significant opportunities to improve public services, expand access to knowledge and increase productivity across sectors of the economy.

Also speaking at the summit, NITDA Director-General Kashifu Inuwa, represented by Acting Director of Regulation and Compliance Emmanuel Edet, stressed the importance of responsible AI development.

Inuwa said Nigeria must move beyond being a consumer of foreign AI technologies and develop local talent, research ecosystems and homegrown solutions capable of addressing African challenges.

“The future of AI should not simply happen in Africa; Africa must shape it,” he said.

The summit brought together stakeholders from government and the private sector, including representatives of the Nigeria Customs Service, the National Identity Management Commission and Galaxy Backbone, to discuss strategies for scaling responsible AI adoption across Nigeria.

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The affected repositories include projects linked to Microsoft’s Azure cloud platform and software development tools used with AI coding applications such as Claude Code, Gemini CLI and Visual Studio Code.

Security researchers from Cloudsmith and OpenSourceMalware were among the first to identify the compromise. According to their findings, the malicious code was designed to steal passwords and sensitive credentials from users who downloaded or interacted with the affected projects.

Microsoft confirmed that it temporarily removed repositories while investigating the incident. Company spokesperson Ben Hope said some projects have since been restored, while others remain offline pending further review.

The company also said it had notified a small number of potentially affected customers and would continue contacting users if additional risks were identified.

More than 70 Microsoft-owned repositories were reportedly disabled on GitHub as part of the response. Security experts have described the incident as a supply chain attack, a type of cyberattack in which hackers compromise widely used software components to reach large numbers of users.

The breach follows another recent compromise involving Microsoft’s open-source Durable Task project, raising concerns about repeated targeting of the company’s developer ecosystem.

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Unlike traditional AI chatbots that respond only when prompted, Scout operates continuously in the background, monitoring workflows and taking action on behalf of users within approved organisational policies.

The AI agent integrates with services including Outlook, Teams, OneDrive and SharePoint, allowing it to access emails, calendars, chats, documents and contacts.

According to Microsoft, Scout can coordinate meetings across different time zones, schedule focus sessions, prepare briefing materials and identify workflow bottlenecks before they become major issues.

A central component of the platform is Work IQ, a system that learns user habits and priorities over time to anticipate future needs and provide proactive assistance.

Microsoft said Scout operates through a governed identity managed by Microsoft Entra, enabling organisations to monitor AI actions while maintaining security and compliance requirements.

The company has begun rolling out Scout to select customers through a private preview programme and participants in its Frontier initiative.

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