Satya Nadella wants AI to solve real problems after Microsoft cuts 6,000 jobs, more layoffs likely in July

India Today

4 hours ago

As artificial intelligence rapidly reshapes the tech landscape, Microsoft CEO Satya Nadella is urging the industry to take a hard look at the real-world value it delivers, especially considering the immense energy AI systems consume. Speaking at Y Combinator's AI Startup School, Nadella challenged the tech world to justify the environmental cost of powering large-scale AI. 'If you're going to use energy, you better have social permission to use it,' he said. 'We just can't consume energy unless we are creating social and economic value.'advertisementNadella's comments come at a time when AI is being hailed as the future of innovation, but also criticised for its potential to widen inequalities and burn through resources. For Microsoft, one of the largest builders of AI infrastructure in the world, the question hits particularly close to home. A 2023 report by Clean View Energy estimates Microsoft used around 24 terawatt-hours of electricity last year—roughly equivalent to the annual consumption of a small country.But Nadella insists that the measure of AI's success lies in whether it can simplify daily challenges. 'The real test of AI,' he explained, 'is whether it can help solve everyday problems — like making healthcare, education, and paperwork faster and more efficient.'
He offered a striking example of the American healthcare system, where inefficiencies often inflate costs. 'A simple thing like hospital discharge — if done with an AI model — can save time, money, and energy,' he said, highlighting how AI could help untangle bureaucratic knots in overburdened institutions.advertisementIronically, despite the optimism, Microsoft's AI-driven vision for the future is not without its human cost. In the past year alone, the company has laid off over 6,000 employees, attributing the job cuts to shifts driven by AI and automation. In a statement, Microsoft described the layoffs as part of 'organisational changes necessary to best position the company for success in a dynamic marketplace.'That dynamic marketplace, of course, is increasingly defined by AI tools and cloud platforms. Microsoft, alongside its strategic partner OpenAI, has placed AI at the heart of its business transformation. But with that transformation comes a wave of internal restructuring—often at the expense of human jobs.And the shake-ups might not be over. Reports now suggest that Microsoft is planning another round of layoffs, this time targeting its Xbox division. The move is said to be part of a broader corporate reorganisation as the company nears the end of its financial year.If carried out, it would mark the fourth major round of job cuts at Microsoft in just 18 months. The company is under mounting pressure to improve profitability following its $69 billion acquisition of video game giant Activision Blizzard in 2023. With shareholders watching closely, the company appears determined to trim costs and double down on its AI and gaming ambitions.All in all, this only proved that it is a balancing act -- building the future with advanced technology while proving that the immense energy usage and the workforce disruptions involved are worth it. - Ends