On May 21, 2024, at Microsoft Build, Microsoft and Khan Academy announced that Khanmigo for Teachers - the educator-facing version of Khan Academy’s AI assistant - would become free for all US teachers. The tool had previously cost teachers a small monthly fee to cover its compute and development costs; under the partnership Microsoft donated access to the underlying Azure infrastructure, including the Azure OpenAI Service, so the nonprofit could offer it at no charge.
Khanmigo for Teachers helps educators with prep-heavy tasks - generating rubrics, planning lessons, drafting individualized education programs, and similar work across more than twenty tasks - that Khan Academy said can consume more than half of a teacher’s workload. The two organizations also said they would collaborate on cheaper, more scalable math tutoring using a fine-tuned, open version of Microsoft’s small Phi-3 model, and integrate Khan Academy content into Microsoft Copilot and Teams for Education.
Why business readers should care: the deal shows the economics behind consumer and education AI - the binding constraint is often compute cost, and a cloud provider absorbing that cost can turn a paid pilot into a free, mass-distributed product overnight while locking the workload onto its platform.