Microsoft has announced a new operating business called Microsoft Frontier Company, focused on delivering successful enterprise AI deployments with the company’s existing AI tools. The project will be backed by a $2.5 billion investment from Microsoft. In a blog post announcing the venture, Microsoft’s Commercial Business CEO Judson Althoff did not use the Forward Deployed Engineer (FDE) label that is generally applied to these ventures. “Today we are introducing Microsoft Frontier Company, a new operating business focused on delivering Frontier Transformation through AI for our customers around the world. It will provide a unique combination of skills inclusive of deep industry knowledge, change management and continuous improvement experience, and enterprise-grade AI engineering expertise. This goes beyond what has been labeled as Forward Deployed Engineering (FDE) and will be the largest, most capable, outcome-driven engineering organization in the industry. We are making a $2. 5B investment in Microsoft Frontier Company, embedding 6,000 industry and engineering experts at customers to co-design, co-innovate, deploy and continuously improve AI systems at scale based on measurable business outcomes,” wrote Althoff.Seemingly accepting the complaint that several companies have been making that companies are buying more AI tools, but those investments are not yet paying off in obvious ways. Althoff said that the idea for the new organization came in part from customer concerns about the ballooning costs of AI and that Microsoft can help those businesses improve the way they use AI, such as by swapping out expensive models for cheaper ones. “The pace of AI adoption is moving incredibly fast. Customers want measurable business outcomes and their enterprise IP protected. Today, Microsoft is launching Microsoft Frontier Company, a $2. 5B investment with 6,000 industry and AI engineering experts working alongside customers to co-design, deploy, and continuously improve AI systems that drive the ROI on AI,” he wrote in a post on X.Taking the AI investment ROI issue further, Microsoft exec wrote in his blog post, “Companies need to establish an intelligence platform so their unique IQ — their proprietary data, expertise, workflows and decision-making processes — compounds over time from within, using their choice of models to build AI solutions and workflows. They need a trusted platform that allows them to observe, govern, manage and secure AI solutions across every layer of the technology stack, using FinOps to assess their ROI.“Microsoft exec wrote, “Enterprise AI engineering expertise with deep industry knowledge is required to build a system that acts as a continuous loop of improvement between the two platforms to fine tune agentic business processes, ensuring that a customer’s intelligence compounds over time and delivers real business outcomes. This is what Microsoft Frontier Company was built to do: focus on end-to-end Frontier Transformation, enabling customers to amplify their IQ with AI while refining their differentiated value in the markets that they serve.“Microsoft CEO Satya Nadella wrote, “With our new Frontier Co., our ambition is to help every enterprise build its own AI capability, and to help create a frontier ecosystem where every organization can turn its knowledge, workflows, and judgment into its own AI systems that continuously improve.”
Amazon, OpenAI and other companies who joined FDE bandwagon
Popularised by America’s biggest defence technology company Palantir Technologies, the model of deploying engineers within customer organizations has since been adopted by vendors from Salesforce to OpenAI. As recently as this week, Amazon’s cloud unit Amazon Web Services (AWS) announced a similar initiative. AWS announced a $1 billion investment in an organization called Forward Deployed Engineering, also tasked with dispatching thousands of engineers to help clients.
