Codenamed MAI-1, this homegrown whopper is under the watchful eye of Mustafa Suleyman, the former Google AI hotshot who's jumped ship from his last gig as the big cheese at Inflection. Microsoft shelled out a cool €603.79 million to bring on board Inflection's top minds and nab the rights to their intellectual goodies this past March. MAI-1 is pure Vole and has some hand-me-down from Inflection, though it might nick a bit of their training data and tech tricks.

The MAI-1 is set to be a real heavyweight, with a staggering 500 billion parameters to tweak and tune. That's leagues beyond the tiddly open-source models Microsoft's dabbled with before. It will need a truckload of computing grunt and data to get it off the ground, which won't come cheap. Just for a bit of natter, OpenAI's GPT-4 is a goliath with over 1 trillion parameters, while the smaller fry from Meta Platforms and Mistral are playing with a mere 70 billion parameters.

So, what's Microsoft's game plan? It is straddling two horses at once in the AI race by developing its own AI. On one side, they're crafting 'small language models' that won't break the bank and could cosy up in your mobile apps. On the flip side, they're going all out for the big league with state-of-the-art AI models that could give the cloud a run.

It's a bold move, and only time will tell if this gamble pays off or if it has bitten off more than it can chew.