{"id":23037,"date":"2026-08-05T12:31:20","date_gmt":"2026-08-05T12:31:20","guid":{"rendered":"https:\/\/scannn.com\/microsoft-tells-engineers-tokenmaxxing-is-not-what-we-are-optimizing-for\/"},"modified":"2026-08-05T12:31:20","modified_gmt":"2026-08-05T12:31:20","slug":"microsoft-tells-engineers-tokenmaxxing-is-not-what-we-are-optimizing-for","status":"publish","type":"post","link":"https:\/\/scannn.com\/lv\/microsoft-tells-engineers-tokenmaxxing-is-not-what-we-are-optimizing-for\/","title":{"rendered":"Microsoft Tells Engineers \u2018Tokenmaxxing Is Not What We Are Optimizing For\u2019"},"content":{"rendered":"\n
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Microsoft has introduced new limits to how much its engineers can spend on AI tools at work and told employees that maximizing AI use internally is not the company\u2019s goal.\u00a0<\/p>\n

This makes Microsoft one of the last major companies to rein in its employees\u2019 expensive AI use. Scaling back<\/u><\/a> maximalist AI use, or what some companies have called \u201ctokenmaxxing<\/u><\/a>,\u201d is a trend we\u2019ve covered in recent<\/u><\/a> months as the price for using AI has increased while not always delivering commensurate productivity gains<\/u><\/a>.\u00a0<\/p>\n

\u201cAs we accelerate our use of GitHub Copilot to deliver on our goals, we all need to be aware of how we consume tokens,\u201d Jay Parikh, an executive vice president at Microsoft said in an email to Microsoft employees. GitHub is owned by Microsoft, and GitHub Copilot is an AI coding tool. \u201cTokenmaxxing 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.\u201d\u00a0<\/p>\n

\u201cAs such, we are updating our internal guidance and managing token spend with the same discipline we apply to every other critical resource,\u201d Parikh said in the email.<\/p>\n

Parikh\u2019s email says that in an effort to \u201cget greater value from our token investment\u201d Microsoft is making OpenAI GPT-5.6, which is cheaper to use than other models, the default model for internal use. His email also links to updated internal Copilot guidelines stating that, as of July 2026, Microsoft divisions will have an \u201cAI token budget target,\u201d and that employees can track their individual AI spending.\u00a0<\/p>\n

\u201cWhile there is no target spend value being shared at this time. The data shows that many engineers spend in the range of hundreds of dollars a month to a few thousand dollars in tokens,\u201d the guidelines say. They also say that some decisions may place further restrictions as they monitor spend.\u00a0<\/p>\n

As Parikh\u2019s email notes, the change in policy about AI spend wasn\u2019t introduced because Microsoft is tight on cash. To the contrary, its latest earnings report shows the company revenue, operating income, and net income all increased for the year, beating Wall Street expectations<\/u><\/a>. But the new policy is in line with recent changes at other companies that are trying to curb wasteful AI usage. As we previously reported<\/u><\/a>, companies like Amazon, Adobe, Atlassian, and Citi are all trying to throttle employees\u2019 AI use.<\/p>\n

\u201cIt’s very telling, to me, that a company which has invested so heavily in AI and subsidized so much AI inference is now guiding its own employees to curb spending,\u201d a Microsoft employee, who asked to be anonymous because they were not authorized to speak to the press, told me. \u201cThis 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?\u201d<\/p>\n

Parikh\u2019s email said Microsoft will keep learning and adjusting its AI policies as models and products evolve, and stressed that he doesn\u2019t want to slow down the company\u2019s progress towards becoming \u201cAI-first.\u201d<\/p>\n

\u201cWe are not optimizing for fewer tokens,\u201d he said. \u201cWe are optimizing for more impact per token.<\/p>\n

Microsoft did not immediately respond to a request for comment. <\/p>\n

\n
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About the author<\/p>\n

Emanuel Maiberg is interested in little known communities and processes that shape technology, troublemakers, and petty beefs. Email him at emanuel@404media.co\n<\/p>\n

\n More from Emanuel Maiberg<\/a>\n <\/div>\n<\/p><\/div>\n
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Microsoft has introduced new limits to how much its engineers can spend on AI tools at work and told employees that maximizing AI use internally is not the company\u2019s goal.\u00a0 This makes Microsoft one of the last major companies to rein in its employees\u2019 expensive AI use. Scaling back maximalist AI use, or what some […]<\/p>\n","protected":false},"author":16,"featured_media":23038,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[143],"tags":[],"class_list":["post-23037","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-ai"],"_links":{"self":[{"href":"https:\/\/scannn.com\/lv\/wp-json\/wp\/v2\/posts\/23037","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/scannn.com\/lv\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/scannn.com\/lv\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/scannn.com\/lv\/wp-json\/wp\/v2\/users\/16"}],"replies":[{"embeddable":true,"href":"https:\/\/scannn.com\/lv\/wp-json\/wp\/v2\/comments?post=23037"}],"version-history":[{"count":0,"href":"https:\/\/scannn.com\/lv\/wp-json\/wp\/v2\/posts\/23037\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/scannn.com\/lv\/wp-json\/wp\/v2\/media\/23038"}],"wp:attachment":[{"href":"https:\/\/scannn.com\/lv\/wp-json\/wp\/v2\/media?parent=23037"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/scannn.com\/lv\/wp-json\/wp\/v2\/categories?post=23037"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/scannn.com\/lv\/wp-json\/wp\/v2\/tags?post=23037"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}