[Bloomberg: ByteDance Spends Over $1 Billion Annually on Microsoft AI Services, OpenAI Privately Complains About Insufficient Distillation Prevention] According to monitoring by Beating, Microsoft has built a massive AI business in China by selling OpenAI models to Chinese companies. Bloomberg revealed that ByteDance has become Microsoft's largest AI customer, with annual spending on Microsoft AI and cloud services expected to exceed $1 billion. Ant Group, Meituan, and Tencent are also major buyers of Microsoft Azure cloud services, with most of these expenditures supporting overseas business expansion. Within Microsoft, the business of selling AI models to China is growing rapidly. Former Chief Commercial Officer Judson Althoff disclosed at an internal sales meeting in July 2025 that Azure's AI business in China had the fastest revenue growth among all global sales regions. After a 400% increase in revenue in fiscal year 2024, revenue tripled in fiscal year 2025. Althoff stated that the world's top AI solutions are being developed on the U.S. West Coast and China's East Coast, with Microsoft serving as the bridge connecting the two. However, Microsoft's practice of reselling models in China has raised concerns within OpenAI. Since OpenAI and Anthropic do not directly sell models to China due to safety considerations, Microsoft has leveraged its unique partnership agreement to independently establish policies for reselling GPT series models in China. OpenAI has privately complained to Microsoft, arguing that Microsoft has not taken sufficient measures to prevent Chinese customers from using distillation to replicate OpenAI's models and develop competing products. To prevent intellectual property theft, Microsoft has not deployed models in China; Chinese customers can only access servers in locations such as Singapore via cross-border internet connections. [Original Article Link]