This is an excerpt from Alex Heath SourcesA newsletter about artificial intelligence and the tech industry, distributed only to The Verge subscribers once a week.
To get a sense of how Microsoft sees its role in the AI race, look at what was announced at the GitHub Universe developer conference on Tuesday in San Francisco.
This event marked a turning point for one of Microsoft's most important but often under-analyzed assets. GitHub, used by more than 180 million developers, wants to become the central platform for AI coding agents. This is new Agent Headquarters The interface allows external programming assistants, including Codex OpenAI and Claude Code Anthropic, to connect to the GitHub ecosystem.
The time is right. If GitHub doesn't evolve fast enough, Microsoft risks being left behind thanks to a wave of agent-based coding tools that are rapidly redefining what software development looks like. Tools like the cursor, which coincidentally announced a major update this week they are already organizing entire workflows for developers, and not just autocompletion of code. While agents don't yet have a significant impact in other industries, in software development the line between assistant and colleague is quickly blurring.
“We need a wide-open ecosystem.”
Jared Palmer, GitHub's new senior vice president, joined Microsoft from Verseilles just 10 days before we spoke at the Universe conference this week. “GitHub is at an interesting transition,” he said. “It needs to evolve into a platform not only for people, but also for agents.”
Palmer said the goal is for GitHub to remain “the home where development happens” no matter what AI tools developers choose. “We need a wide-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 headquarters in the coming months.
Thanks to GitHub's long-standing important role in storing code, it has a good chance of becoming the glue between agents and codebases. This will mean that Microsoft will remain at the center of the developer universe. If this doesn't happen, developers may eventually move their work and data elsewhere.
Jay Parikh oversees GitHub as Microsoft's executive vice president of CoreAI. The longtime Facebook CTO and Atlassian board member joined Microsoft nearly a year ago and now leads a team of about 10,000 people. His goal is to reimagine Microsoft's entire stack for building artificial intelligence applications: the infrastructure, security, and tools that developers use every day.
“We need to move faster,” Parikh told me in an interview this week. “We need to build better tools, different tools. We need an ecosystem of developers, that choice, and everything that supports this new way of building software.”
“People will start spending more time on the spec and creative process and delegating the actual calories they burn to GPUs.”
He believes GitHub's role is important to this plan, which explains why Microsoft in August included GitHub in its CoreAI group. “You really want GitHub to be that place, that set of tools, that community where developers can really unleash that innovation,” he said. “People will start spending more time on the specification and creative process and delegating the actual calories they burn to the GPUs, the coding agents that generate the code.”
As GitHub COO Kyle Daigle told me, “A developer doesn't need to accumulate memory and context in every single tool they use in the age of AI. You should be able to connect to GitHub and have that context to define how you want to work, even if you're using that tool outside of the GitHub platform.”
This bet is directly related to Microsoft's long-standing partnership with OpenAI. On the same day as GitHub Universe, CEO Satya Nadella appeared on TBPN to discuss Microsoft's renewed partnership with OpenAI. He said that “GitHub is where the billion to ten billion happened” – a reference to how the early success of GitHub Copilot, based on OpenAI's Codex, convinced him to dramatically increase Microsoft's initial $1 billion investment in OpenAI.
GitHub has always served two important functions: 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 work and build a community. Microsoft may have sparked the AI coding boom with the release of the original GitHub Copilot, but now it needs to prove it can keep up with where the industry is going.
