This is an excerpt from Source by Alex HeathA newsletter about AI and the tech industry, syndicated to The Verge subscribers only once a week.
To understand how Microsoft sees its role in the AI race, check out what it announced at the company’s GitHub Universe developer conference on Tuesday in San Francisco.
This event proved to be a turning point for one of Microsoft’s most important but often under-analyzed properties. GitHub, which is used by more than 180 million developers, wants to become the central platform for AI coding agents. this is new Agent Headquarters The interface lets external coding assistants plug into the GitHub ecosystem, including OpenAI’s Codex and Anthropic’s Cloud Code.
The time is appropriate. If GitHub doesn’t move fast enough, Microsoft is at risk left behind Powered by a wave of agentic coding tools that are rapidly redefining software development. Tools like cursors, which incidentally A major update announced This week, there are already entire workflows organized for developers instead of just autocomplete code. While agents are not yet making a significant impact in other fields, in software development, the boundary between assistant and co-worker is rapidly disappearing.
“We need a very wide-open ecosystem.”
Jared Palmer, GitHub’s new senior vice president, joined Microsoft from Vercel just 10 days before we spoke at this week’s Univision conference. “GitHub is in this interesting transition phase,” he said. “It needs to evolve into a platform not only for people, but also for agents.”
Palmer said the goal is to keep GitHub “the home where development happens,” no matter what AI tools developers choose. “We need a very open ecosystem,” he told me. In addition to OpenAI and Anthropic, Google, Cognition, and XAI have also committed to bringing their coding agents to Agent HQ in the coming months.
Thanks to GitHub’s long-essential role in storing code, it has a good shot at becoming the connective layer between agents and the codebase. This would mean that Microsoft would remain at the center of the developer world. If it doesn’t, developers may move their work and their data elsewhere over time.
Jay Parikh oversees GitHub as Microsoft’s executive vice president of CoreAI. The longtime Facebook CTO and Atlassian board member joined Microsoft about a year ago and now leads a group of about 10,000 people. His work is to rethink the entire Microsoft stack for building AI applications: the infrastructure, security, and tools developers use every day.
“We need to move fast,” Parikh told me in an interview this week. “We need to create better tools, different tools. We need that developer ecosystem, that choice and all the things that support this new way of building software.”
“Humans will start spending more time in the specification and creative process and hand over the actual calories they burn to the GPU.”
He sees GitHub’s role as essential to that plan, which explains why Microsoft added GitHub to its CoreAI group in August. “You really want GitHub to be that space for developers, that toolchain, that community that can really unlock this innovation,” he said. “Humans will begin to spend more time in the specification and creative process and hand over the actual calories spent on GPUs to the coding agents who generate the code.”
As GitHub COO Kyle Daigle told me, “A developer shouldn’t have to build memory and context into every single tool they’re using in this AI age. You should be able to connect to GitHub and have that context to determine how you want to work, even if you’re using that tool from GitHub’s platform.”
This bet is directly related to Microsoft’s long-running partnership with OpenAI. On the same day as GitHub Universe, CEO Satya Nadella appeared on TBPN to discuss Microsoft’s updated partnership with OpenAI. He said that “GitHub is where billions to ten billions happened” – a reference to how the initial attraction of GitHub Copilot, powered by OpenAI’s Codex, convinced him to dramatically expand Microsoft’s initial $1 billion investment in OpenAI.
GitHub has always played two important roles: it is a massive repository of open-source code and one of the largest collaboration hubs ever created. Engineers use it not only to store and manage their code, but also to find jobs and build communities. Microsoft may have fueled the AI coding boom with the original GitHub Copilot, but now it has to prove it can keep up with the direction the industry is headed.
