Microsoft CEO fires back: “Anthropic Fable censorship is too strict”: AI tokens shouldn’t be controlled by two big companies

Microsoft CEO Satya Nadella, in an internal meeting with Copilot engineers, publicly criticized partner Anthropic’s usage restrictions on its flagship model Fable as “unreasonable.” He described it as a creative tool that’s subject to “overly controlled” editing—one that refuses to answer at the drop of a hat. He then escalated his criticism to the entire industry, saying AI token computational resources should not be held by only two companies, while everyone else can only use them on a rental basis. Microsoft only announced its investment in Anthropic of 5 billion USD last November, and Anthropic also pledged to spend 300 billion USD on Azure—these remarks are essentially aimed at a major partner and customer.
(Background: Microsoft CEO warns: AI is replicating global tragedies, and every company must accumulate “human capital” + “Token capital.”)
(Additional background: Anthropic was “blacklisted” by the U.S. government and asked to remove the Fable model; foreign media cite three major concerns: it may help China’s open-source AI.)

Table of contents

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• Fable keeps refusing to answer and is criticized for “editorial control”
• The real firepower: token capital can’t be held by just two companies
• Investment is one thing—compute power still has to be in your own hands

Key takeaways

• In an internal meeting, Microsoft CEO Nadella criticized Anthropic’s flagship model Fable for refusing to answer too casually, likening it to a tool “overly controlled” in the editorial sense.
• He said AI token resources shouldn’t be monopolized by two companies and that everyone else rents them—economically, it doesn’t make sense.
• Microsoft invested 5 billion USD in Anthropic last November, and Anthropic pledged 300 billion USD in Azure spending; both sides are partners and customers.

Barely after shelling out 5 billion USD to invest in Anthropic, Microsoft CEO Satya Nadella, in front of his own engineers, publicly went after this partner. According to CNBC, Nadella, in an internal meeting with Copilot engineers, said that the request restrictions Anthropic imposed on its flagship model Fable are “unreasonable,” and that he finds the approach of refusing to answer whenever it wants quite unacceptable.

What Nadella really wanted to say was actually coming later.

Fable keeps refusing to answer and is criticized for “editorial control”

Nadella’s dissatisfaction centers on how Fable refuses requests. He said that when using Fable, it often rejects users for some inexplicable reasons, making it very hard to predict.

If you use Fable, it refuses you all the time for some random reason. When was the last time you used a creative tool that was so “overly controlled” in editing?

Fable’s situation is not without context. Only three days after Fable launched, Anthropic temporarily cut off access to Fable in order to comply with U.S. government export-control instructions; it only resumed operations on July 1. At the time, Anthropic also got ahead of the issue by saying that its new safety measures would misclassify a higher proportion of “harmless requests” as content that needed to be intercepted compared with the previous version. Anthropic’s support page also shows that when users ask about certain topics related to large-model development, the platform may switch to the older model to respond.

The real firepower: token capital can’t be held by just two companies

If criticizing Fable was just the appetizer, Nadella’s next line is the main course. He argued that companies should be able to develop custom models at lower cost and control their own internal data, rather than handing the lifeline to only a handful of companies.

It can’t be that the whole world only has two companies that own token capital, and everyone else can only use it on rent. That doesn’t make economic sense.

Here, “token” is the unit that measures how much compute an AI model consumes. Nadella’s “token capital,” in plain terms, is how many AI compute chips—how much AI computing power—a company has on hand. He didn’t name which two companies, but his wording clearly targets those monopolizing top-tier computing resources and forcing everyone else to pay for rental access. He even used sharper metaphors, warning companies not to end up as “compute tenant farmers,” working the fields for others.

Looking at Microsoft’s situation, the logic behind his remarks becomes even clearer. On one side, Microsoft relies on models from Anthropic and OpenAI to support the Copilot product line; on the other side, it is working hard to nurture its own MAI series models and Maia chips, aiming for a future where it doesn’t have to read everyone else’s faces. Criticizing the partner’s content moderation is the explicit line; paving the way to build its own models is the implicit one.

Investment is one thing—compute power still has to be in your own hands

What’s worth noting is the two-sided nature of this relationship. In November last year, Microsoft announced an investment of 5 billion USD in Anthropic. In the same alliance, Nvidia also increased its contribution by up to 100 billion USD, while Anthropic pledged to spend at least 300 billion USD on Azure cloud. This deal pushed Anthropic’s valuation to surge to roughly 3500 billion USD. Microsoft is both a shareholder and a cloud landlord, and Copilot is still a customer of Anthropic.

For this reason, rather than sounding like dissatisfaction with Anthropic, Nadella’s remarks are better understood as reasons Microsoft is telling itself. Investment can be made and deals can be signed, but this CEO clearly has no intention of staking everything on someone else’s tokens.

Frequently asked questions

Why did Nadella criticize Anthropic’s Fable model?

In an internal meeting with Copilot engineers, he criticized the way Fable refuses requests as too casual, likening it to a creative tool “overly controlled” in the editorial sense, making it hard for users to anticipate. This comes from new safety measures adopted after Fable resumed operations, which can misjudge and flag a higher proportion of harmless requests.

What is Nadella’s “token capital”?

Token is a unit used to measure the compute usage of AI models. “Token capital” refers to the ability to control large amounts of AI computing resources. Nadella believes these resources should not be monopolized by only two companies, and that others should not have to rent them—companies should be able to develop custom models at low cost and control their internal data.