Microsoft has announced a strategic partnership with French AI startup Mistral, marking a significant move to diversify its AI portfolio beyond its existing collaboration with OpenAI. This multi-year partnership involves Microsoft taking a minority stake in Mistral, with a $16.3 million investment, and will see Mistral's AI models, including the newly released Mistral Large, being made available on Microsoft's Azure AI platform. Mistral Large, described as a flagship model, boasts top-tier reasoning capabilities, multilingual support, and a 32k model size, with a reported 81.2% accuracy on the MMLU benchmark, and is priced 20% cheaper than GPT-4-Turbo. The partnership aims to accelerate AI innovation, with Mistral's models offering competitive alternatives to existing AI technologies like GPT-4. The deal has garnered attention for its potential to enhance Microsoft's position in the rapidly evolving AI market, while also facing scrutiny from EU regulators concerned about the implications for competition and regulatory compliance.