Microsoft tells engineers to curb their token-burning enthusiasm

AI AND ML

Redmond wants results from Copilot, not impressive-looking consumption figures

Concerned about cost, Microsoft is reportedly warning employees against wasteful AI use.

In an email seen by 404 Media, Microsoft Executive Vice President Jay Parikh warned that individual divisions would be given targets and could face restrictions. "Tokenmaxxing is not what we are optimizing for. I want all of us focused on maximizing outcomes that move the needle for our customers and our business," the email states.

The Register asked Microsoft what it made of the report, and a spokesperson told us the company had "nothing to add."

Microsoft is hardly short of cash and has continued to pour money into its AI investments, but its apparent efforts to curb wasteful AI spending bring it into line with other companies attempting to rethink how employees use AI.

Tokenmaxxing is the practice of using as many AI tokens as possible, and treating the volume as proof of productivity. A token is the basic unit used to process and bill for the input and output of AI models. If a company is measuring employees' use of AI, burning through as many tokens as possible will make the figures look rosier.

However, companies need to consider the cost of those tokens alongside other factors, such as productivity. As The Register observed in April: "Tokenmaxxing isn't an AI strategy."

Microsoft does not appear to be seeking an overall reduction in token use – it wants to be an AI-first company, after all. It simply wants more bang for its buck.

"As we accelerate our use of GitHub Copilot to deliver on our goals, we all need to be aware of how we consume tokens," the email reportedly said. GitHub moved to usage-based billing in June. Although Microsoft's code-hosting tentacle measures consumption in AI Credits rather than raw tokens, the change makes the cost of engineers burning through them harder to ignore.

Not that this sends a particularly great message to customers. As one anonymous Microsoft staffer told 404 Media: "This really feels like the ultimate admission that we, as hosts of AI infra, can't afford our own AI products. And if that's even partially the case, how could the companies we sell it to manage?"

That's a little simplistic. Microsoft can afford its AI products; the email suggests it wants engineers to use them with greater regard for cost and results.

Which is, perhaps, the message customers should take away. AI tools and services carry a cost that needs to be measured, rather than treating "how many tokens did you consume?" as a measure of AI adoption. ®