This Week in Microsoft: Smarter PCs, Smaller Models, and Sustainable Cloud Innovation

As we head through May, Microsoft continues to lead the way in reshaping the future of work, cloud, and computing experiences. This week’s updates deliver powerful enhancements across Windows, Copilot, AI models, and sustainability.

Key Takeaways

  • Windows 11 gets even smarter with intuitive AI features, enhanced productivity tools, and rich accessibility options.
  • Copilot evolves into a true business partner, thanks to memory, customisation, and new agents for research, data, and creative work.
  • Small Language Models like Phi-4 are punching above their weight, offering advanced reasoning at lower resource costs.
  • Microsoft shares ground-breaking sustainability research, helping the industry reduce datacentre impact.

 

New Copilot Developments: Human–Agent Collaboration

The Wave 2 release of Microsoft 365 Copilot is another great update. It’s no longer just a productivity assistant, it’s evolving into an intelligent agent ecosystem. With new features like AI-powered search, a redesigned “Create” experience, and Copilot Notebooks that contextualise your work in real-time, Copilot is being positioned as the foundation of tomorrow’s digital workplace.

Key innovations include:

  • The Agent Store – Prebuilt and custom AI agents from Microsoft and partners.
  • Researcher and Analyst agents – Using OpenAI’s latest reasoning models to help you handle complex research and data tasks.
  • Personalisation and memory – Copilot now remembers how you work, offering tailored assistance without compromising your privacy.
  • Design for all – Use GPT-4o-powered image generation to create assets aligned with brand guidelines.

With deep integration across Microsoft 365 and third-party platforms, this update marks a shift toward a future where everyone has an AI-powered teammate on demand.

 

New updates for Windows: Personalised, Accessible and Infused with AI

Microsoft’s Windows team unveiled a slew of updates built for Copilot+ PCs, reinforcing the OS as a powerful, intuitive environment for getting things done.

What’s new:

  • Click to Do: Take instant actions on text or images, from summarising content and scheduling meetings to sending Teams messages.
  • Smarter Settings: Just describe your issue, and Windows will fix it for you using AI agents.
  • Image Editing Tools: Paint and Photos now offer pro-grade AI tools like relight, object select, and sticker generation.
  • Notepad and File Explorer Upgrades: Write from a prompt, summarise content, and use AI-driven file actions without breaking your workflow.
  • Accessibility Boosts: Narrator now provides detailed image descriptions, and Voice Access continues to evolve.

With these updates, Windows becomes more than an OS, it becomes a creative, supportive copilot, helping users of all abilities and professions do more with less friction.

 

Phi-4: Small Models, Big Breakthroughs

One year after launching its Phi family of Small Language Models (SLMs), Microsoft is back with a bold evolution: Phi-4-reasoning, Phi-4-reasoning-plus, and Phi-4-mini-reasoning.

Why it matters:

  • These models bring complex reasoning, once reserved for large frontier models, to smaller, faster deployments.
  • Phi-4-reasoning beats models 5–10x its size on scientific and mathematical benchmarks.
  • Phi-4-mini-reasoning, with just 3.8 billion parameters, outperforms several 7B+ models on education-focused tasks like maths problem solving.

Optimised for Copilot+ PCs via the Phi Silica variant, these models bring high-performance reasoning to local devices, no internet or GPU required. That means faster, cheaper, safer AI, available offline.

 

Microsoft’s Sustainability Playbook: Cooling the Cloud Without Warming the Planet

In a landmark Nature study, Microsoft has published the first comprehensive life cycle assessment (LCA) of data centre cooling techniques, measuring carbon, water, and energy use from start to finish.

Key insights:

  • Cold plate cooling cuts emissions by 15%, water usage by up to 50%, and energy demand significantly compared to traditional air cooling.
  • The study also shows that switching to 100% renewable energy can reduce GHG emissions by 85–90%, regardless of cooling method.
  • Microsoft is sharing its LCA tools and methodology openly, encouraging the industry to adopt greener, data-informed decisions.

This research isn’t just academic, Microsoft is already deploying cold plate cooling at scale, showcasing a commitment to sustainable infrastructure that scales with AI growth.

Find out more from Microsoft here.

 

FAQ

Q: What’s the difference between Copilot and the new agents like Researcher and Analyst?
A: Copilot now serves as a central AI workspace. Agents like Researcher and Analyst specialise in tasks like complex research and data analysis using advanced reasoning models, think of them as plug-in experts.

Q: Do I need a new PC to use the latest Windows 11 features?
A: Most new features are rolling out to Copilot+ PCs (starting with Snapdragon-powered devices) via the Windows Insider program. Broader rollout to Intel and AMD systems is expected later this year.

Q: Are Phi models available for developers?
A: Yes. Phi-4 models are available through Azure AI Foundry and HuggingFace, and can also run locally on compatible devices. They’re designed for integration into apps and services with low-latency, high-efficiency use cases.

Q: How does Microsoft’s sustainability research help other businesses?
A: The published methodology and tools allow others to conduct their own life cycle assessments, compare cooling technologies, and make informed decisions about data centre design and sustainability.