MS-721 information - Microsoft 365 Certified: Collaboration Communications Systems Engineer Associate Updated: 2024

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Microsoft’s move into what it calls “unified communications” will spark a turf war with powerful players, including PBX makers and Cisco, that will all attack the market from their relative positions of strength, partners said.

In the process, Microsoft and these players—most of which are also its partners—will square off for a bigger chunk of an estimated $40 billion worldwide market for voice/telephony software and infrastructure, partners say.

Microsoft will start to talk more about its plans at a unified communications event in June, said Zig Serafin, general manager of Microsoft’s Unified Communications Group (UCG). Sources said to expect more information on the next Live Communications Server (LCS).

The upcoming LCS will offer on-premise presence and instant messaging (IM), as well as audio-, video- and Web conferencing, sources said. The current LCS does IM and on-premise presence, while Web conferencing is the province of Live Meeting, a hosted service underlying Microsoft’s current Live Meeting, which grew out of Microsoft’s acquisition three years ago of Placeware.

Unlike Exchange Server 2007, the new LCS—once known by its code name, Kiev, and now referred to internally simply as Live Server—will not be 64-bit only. It will be part of the Office 2007 “wave,” Serafin said.

The public message will be one of collaboration between Microsoft and partners such as Cisco, Avaya and other makers of PBXes. Behind the scenes, though, all of those companies will compete for many of the same customer dollars.

“Do the math. The market for collaboration software is $4 billion. The market for voice is $40 billion. If you were Microsoft, where would you go?” asked a Microsoft source who requested anonymity.

The issue is that what Microsoft offers and what Cisco offers in terms of instant messaging are very similar, and few customers will buy both.

“Cisco started with voice, then added conferencing and video and voice mail. Microsoft started with Office and app integration, added presence and IM and conferencing first as a service [and] then on-premises,” the source said. Microsoft will attack unified communications, the term it applies to converged realtime and asynchronous communications—including IM, e-mail and voice—from the application layer, while Cisco will do so from the network layer, Serafin said. That UCG organization was formed in January to meld Microsoft’s realtime collaboration and Exchange e-mail groups.

In some ways, this is an old story. Microsoft has talked up its role in what was called computer-telephony integration (CTI) for years. But with the upcoming release of new versions of LCS and related products, it’s going to turn up the volume. Microsoft’s issue here is that despite progress in reliability and security, it is unclear how many businesses really want to put all of their communications eggs in a Microsoft basket. In short, people do not want to have to reboot their phones.

Serafin said people want the type of innovation they see on their laptop and desktop to spill over into their overall communications. When is the last time you saw a radically improved desktop phone? he asked.

The growth in VoIP-enabled PBX switches—and the declining sales of proprietary switches—could help here.

Dell’Oro Group reported last week that the IP-enabled PBX category was the only growth segment among all PBX sectors for the first quarter of this year. Avaya’s IP telephone shipments grew 50 percent year over year, according to Steve Raab, researcher at Dell’Oro.

Some Microsoft partners said they welcome the company’s push with open arms, citing customer demand.

“People are sick and tired of having to go four or five places for voice mail, e-mail, text,” said Kerry Mann, president of Mantralogix, a Microsoft systems integration partner in Mississauga, Ontario. “We are looking forward to this with bated breath, although, of course, we need to see proof of concept. The proof is in the execution.”

Communications services companies rose after one publisher sought reimbursement for use of its content for training generative artificial-intelligence machines.

Shares of New York Times Co. rose after the newspaper publisher sued Microsoft and OpenAI for alleged copyright infringement, touching off a legal fight over generative-AI technologies with far-reaching implications for the future of the news publishing business. Among the Times's peers, shares of News Corp rose in sympathy, while Gannett fell.

ACM TechNews

By The New York Times
December 29, 2023
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The New York Times has sued OpenAI and Microsoft for copyright infringement, contending that millions of articles published by the newspaper were used to train automated chatbots that now compete with the news outlet as a source of reliable information.

The complaint cites several examples when a chatbot provided users with near-verbatim excerpts from Times articles that would otherwise require a paid subscription to view.

It also highlights the potential damage to the Times’ brand through so-called AI “hallucinations,” a phenomenon in which chatbots insert false information that is then wrongly attributed to a source.

From The New York Times
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Abstracts Copyright © 2023 SmithBucklin, Washington, D.C., USA

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The technology sector has reported substantial positive momentum in the past three months, being the leader also on a yearly retrospective. However, the information technology services industry has reported a more modest performance over the past 12 months, with infrastructure software running out of steam over the past few months. Despite closely following the technology sector in its yearly stellar performance, the communication services sector has slowed down significantly over the past three months, with companies in the internet content and information industry turning to laggards from their leadership position.

Alphabet and Microsoft compete in many industries and businesses, owning significant market shares in specific segments. Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL) is the virtually unchallenged leader in online search, as its search engine, Google, processes over 91% of search volume worldwide, and the company's share of global digital advertising revenues is estimated at 39%. Microsoft's (MSFT) search engine, Bing, is processing only 3% of search volume, and the digital advertising market share it achieved with its search engine and through LinkedIn is about the same size. Microsoft's lion's share of its revenue is generated through server products and cloud services, its Microsoft 365 and Windows software suite, and increasingly by its gaming segment, but the company's office productivity suite is challenged by Google's Workspace, which counts over 3 billion users. However, the majority of these are likely Gmail users. According to Gartner (IT) estimations, Google is taking 1% to 2% market share per year, while Microsoft dominates the productivity software market with over 89% market share estimated in 2020. Microsoft's Azure cloud infrastructure holds about 22% of the worldwide market share, second only to Amazon (AMZN), which leads with 32%, followed by Google Cloud with 11%.

Furthermore, the two giants are both heavily investing in Artificial Intelligence [AI], a technology that will directly or indirectly affect many, if not all, of their products and services and will be determinant for the future of both companies. Alphabet has significant potential to monetize its AI efforts by leveraging its product portfolio, such as its search engine, YouTube, Google Cloud, or Android platform. The company has disclosed important customers using its Google Cloud services, including 70% of GenAI startups valued at more than $1B and companies such as Anthropic, Midjourney, Cohere, or Character.AI. The latter is in talks for a significant investment from Alphabet in hundreds of millions. At the same time, Anthropic declared having received an upfront investment of $500M and a commitment of up to $2B investment, as Alphabet recognized the opportunity in its chatbot Claude to be a valid rival to ChatGPT, owned by the company OpenAI, backed by Microsoft with an investment of up to $13B for a 49% stake of its profit sharing.

Taking into account the consensus from a wide range of published studies, the global IT service market is projected to grow on average at a 9.43% Compound Annual Growth Rate [CAGR] through 2030; the global cloud service market is estimated to grow significantly faster at 16.60% CAGR through 2031, with the cloud-based office productivity software solutions segment seen accelerating at 25.50% CAGR by 2030, with China leading the expansion at 30.80% CAGR. Major growth drivers include global investments in smart cities, with the integration of Internet of Things [IoT] technologies, AI, and increasing demand for cyber security; the rise of automation to enhance business operations and decrease resource waste, as well as increased adoption of cloud platform services by SMEs and in developing regions. The global AI market size is estimated at $242B in 2023, with the healthcare, finance, and manufacturing industries, business and legal services, and transportation representing more than 67% of the market share. It is expected to grow at 17.30% through 2030, resulting in a market size of $7390B, led by developments in machine learning, natural language processing, computer vision, autonomous and sensor technology, and AI robotics.

An in-depth company comparison

The financial comparison highlights the two competitors' significant relative strengths and weaknesses. Regarding Return on Invested Capital [ROIC], a crucial metric in my investment considerations, as it signifies a company's ability to generate value consistently, Microsoft has demonstrated more robust capital allocation efficiency in accurate years, even though this metric has shown a tendency to soften. Conversely, Alphabet has reported a more resilient capacity in this regard. The significant spread between the companies' ROIC and their Return on Capital Employed [ROCE] implies that their core business is highly efficient regarding capital allocation. Still, the actual returns accrued to investors could be even higher by employing their prominent idling cash positions. Alphabet reported $119.93B and Microsoft $143.95B TTM cash and marketable securities at the end of Q3, and both reported a substantial negative net debt. Microsoft's debt exposure, measured by total debt to EBITDA, is three times higher than Alphabet's, but both companies have plenty of capacity to repay their debt or source more capital from lenders at suitable conditions.

Alphabet's gross margin growth has slightly increased from -0.14% CAGR in the past five years to 1.53% CAGR in the past three years, while Microsoft's gross margin growth decelerated from 1.04% CAGR to 0.24% CAGR over the analyzed time. Alphabet's gross margin is smaller overall, suffering from a lower-margin products and services mix compared to Microsoft's, as the latter generated more than 50% of its revenue with its very profitable cloud business, with a 73% gross margin.

On the operational side, the companies have an even more divergent profile. Microsoft's operating profitability is significantly higher, although the company has seen its profitability growth slowing down from 4.75% in the past five years to 1.11% in the past three years, while a more favorable development has been observed in Alphabet's operating margin growing 6.63% over the past three years, up from 2.85% over the past five years.

Microsoft reportedly has a more cash-rich business than the analyzed peer and is paying a quarterly dividend, while Alphabet has never returned profits to its shareholders through a dividend. Alphabet has instead repeatedly performed stock buybacks, with over $45B returned to its shareholders in the current year, in line with the announced repurchase program of up to $70B. Microsoft is completing the $60B share buyback program unveiled in September 2021 and could launch a new program, as the company has been announcing such buybacks every three years since 2013.

Alphabet's EPS growth rate has been significantly accelerating over the past few quarters and the most accurate years, while Microsoft has reported more modest growth in the accurate quarters and even a slowdown in the growth trend on a yearly comparison.

The stocks' performance

Considering both stocks' performance in the past five years, MSFT outperformed all the analyzed references, reporting a massive performance of 260%, while GOOG performed less impressively, returning 170%, or just slightly more than the Nasdaq technology index, tracked by the Invesco QQQ ETF (QQQ), yet significantly outperformed the S&P 500 (SP500). Two selected industry references with exposure to the stocks, such as the Vanguard Information Technology ETF (VGT) and the Communication Services Select Sector SPDR Fund (XLC), show a mixed performance, hinting at a somewhat divergent performance among peers.

While both stocks display periods of relative strength, especially from the pandemic-related market crash in 2020, MSFT reported a much superior performance and significant resilience after every major drop, while GOOG is struggling to overcome the peak reached in 2021. In the following section, I will discuss the projected direction for both companies in the coming years and evaluate whether the current stock prices present attractive opportunities. Additionally, I will analyze potential risks across various scenarios.

Valuation

I employ the Discounted Cash Flow [DCF] model to ascertain the fair value of both companies' stock prices. This model spans a forecast period of five years and encompasses three distinct sets of assumptions, ranging from a more conservative to a more optimistic scenario. These assumptions are based on the metrics influencing the Weighted Average Cost of Capital [WACC] and the Terminal Value [TV]. As forecasted by the street consensus, Alphabet is anticipated to generate 15.75% Free Cash Flow [FCF] CAGR over the coming five years, with its operating and net profitability increasing at 13.13% and 13.26% CAGR, while its revenue is projected to expand at solid 10.52%, slightly above the expected growth in the global IT service market.

The valuation considers various scenarios related to monetary policy, which will influence the weighted average cost of capital and exert a substantial impact on the potential performance of the stock price.

I compute my opinion in terms of likelihood for the three different scenarios, and I consider the stock to be significantly undervalued with a weighted average price target with 31% upside potential at $183.

Microsoft is forecasted to expand faster than its peer, with its revenue growing at 13.62% CAGR over the next five years, faster than the global IT service market. Its operating and net profit margins are expected to accelerate substantially by 14.48% and 14.73%, respectively. The company's FCF is anticipated to increase sequentially, totaling 16.47% CAGR through 2027.

I subsequently assess the three identical scenarios influenced by the company's fundamentals and external factors.

Although this is a promising outlook, MSFT is overvalued in all three scenarios, leading to a weighted average price target with 23% downside risk at $286, with the most pessimistic scenario considering the stock overvalued by more than a third of its actual valuation. The two modelizations suggest that GOOG may be rated as a buy position, while MSFT is seen as a hold or sell position. Interestingly, in GOOG's modelization, all three scenarios forecast a positive return, emphasizing the divergence in the companies' forward expectations.

Investors should remember that these forecasts hinge on relatively conservative assumptions, encompassing perpetual growth rates, elevated discount rates, and the prevailing trend of rising interest rates. This trend reflects the current situation and anticipates potential scenarios. A reversal of this trend could alter this perspective, leading to a higher valuation for the company.

Outlook and risk discussion

Both companies have massive opportunities to leverage their existing capacities and product mix to build new competitive advantages, reinforce their market share, or enter new segments. These opportunities are multiplied by the integration with AI and the numerous applications in the relevant industry verticals. Alphabet's overdependence on revenue from advertising is threatened by the widespread adoption of advertising-blocking software, a stricter global legal framework, and growing privacy concerns, as well as by the tendency of declining cost-per-click prices the industry is facing with increasing competition. Since the public launch of OpenAI's chatbot ChatGPT on November 30, 2022, Alphabet's Google DeepMind AI unit has scaled up its efforts to develop its own AI software to rival the Microsoft-backed company and finally announced its most potent AI model, Gemini, which includes a suite of three different sizes: Gemini Nano, targeting specific tasks on mobile devices; Gemini Pro recently released to its cloud users, which supports 38 languages in more than 180 countries, and is used by Google's ChatGPT-like chatbot Bard; and Gemini Ultra, it most capable version designed to run in data centers. The update comes after the company's launch of Bard earlier this year, which has yet to be as successful as the company might have been expecting. Alphabet also announced a new generation of its custom-build tensor processing units [TPUs] Cloud TPU v5p, more scalable and designed to train large AI models, and a new supercomputer architecture AI Hypercomputer to boost productivity across AI training, tuning, and serving.

Investors might ask how the companies will turn their AI efforts into profits. Both companies are introducing AI technology in their product portfolio to enhance the user experience and multiply their solutions' capabilities and potential usage. Google is expected to launch its Search Generative Experience [SGE] to the general public, with the opportunity to redefine how users interact with its search engine, which is still a significant source of profit. Microsoft has announced that its Copilot solution, which leverages AI to enhance its productivity software suite, is already used by 40% of Fortune 100 companies, and over 37,000 organizations have subscribed to Copilot for Business; the technology finds its usage in many other applications such as the company's tools for developers Power Platform, Power Apps, and Power Pages. Microsoft counts over 73% of the Fortune 1000 companies that use three or more of their data solutions, and over 18,000 organizations use Azure OpenAI Service. Copilot's inclusion into Microsoft's Windows enriches the operating system with even more AI-powered experiences accessible to 1.6B users worldwide. Alphabet's answer to Copilot is priced at the same $30 monthly subscription price for each user, supporting the company's gain in market share in the enterprise segment.

While Microsoft enjoyed the early benefits of the broadly followed launch of ChatGPT, projecting the company into a leadership position, the AI battle between the two giants is only in its early stages. Alphabet has successfully acquired companies and technologies and demonstrated its superior capabilities in developing disruptive technologies for a global audience. The company's relatively high spending in R&D has led to the most significant patent portfolio among its peers, underscoring its strong competitive position. Despite Microsoft still holding more AI and machine learning patents than its rival, both companies are still far behind companies such as Baidu (BIDU) (OTC:BAIDF), Tencent (OTCPK:TCEHY) (OTCPK:TCTZF), IBM (IBM) and Samsung (OTCPK:SSNLF).

Microsoft's investment in OpenAI valued the company at $86B, but the accurate turmoil around the layoff of CEO Sam Altman and the subsequent dramatic reversal where he was reinstated under a new board of directors after 95% of OpenAI's employees were to leave the company for joining him under Microsoft's AI unit, revealed the fragility of the company's structure. OpenAI LP now operates under an unconventional form called a capped profit corporation, where profits are capped at a maximum of 100 times any investment. The original OpenAI non-profit organization owns the returns beyond that amount. At the same time, no board member can own any equity to avoid any conflict of interest with the investors; the board controls the whole structure and does not answer to the investors or employees, citing "humanity" as their only concern. Strictly speaking, OpenAI investors don't own it, and after the accurate troubles, several investors were ready to write down their investment to zero.

It would be wise to view any investment in OpenAI Global, LLC in the spirit of a donation.

Alphabet's strategic investment in Anthropic comes after rival Amazon announced an immediate investment of $1.25 convertible into equity, with the ability to increase its stake with an additional convertible note of up to $2.75B. At the same time, the option for the secondary note expires in the first quarter of 2024. The run for securing a part of the best and most promising AI technology while acquiring stakes in startup companies such as Antropic or OpenAI has just begun but emphasizes the importance cloud companies supply to aligning with influential AI developers.

With the overall projected monthly probability of a US recession in the coming 12 months increasing to 52% in November, down from a peak level above 70% estimated in May, but up from 46% projected in October, investors should also consider the potential negative impact on the companies' business and stock performance. A recession would hit the tech giant's sales and expose shareholders to potentially significant losses, as seen during the last market crash in 2020, where both stocks lost about one-third of their valuation; however, considering MSFT's relatively rich valuation and despite its impressive resilience, I would consider GOOG as being the safer choice.

Alphabet has been chiefly rated with a strong buy or buy rating from Seeking Alpha's Quant Rating since 2021 with sporadic periods of hold signals and holds the 2nd position out of 60 in the interactive media and services industry.

Since 2021, Microsoft has consistently been rated as a hold position, occasionally reporting buy signals. It occupies the 10th position out of 46 in the systems and software industry. Both companies, somewhat surprisingly concerning Alphabet, receive low rankings in terms of valuation. While profitability and momentum are viewed as positive factors for both, Alphabet appears more favorably positioned in terms of actual revisions and growth prospects.

The verdict: Which stock is the better buy?

From an investor's perspective, evaluating a company's capacity to generate value for its shareholders while mitigating risks is crucial. Past performance does not ensure future outcomes. Although both analyzed companies have demonstrated notable resilience in their stock prices, investors should assess the extent to which the company's future potential has already been factored into its current valuation.

This comparative assessment magnifies the two stocks' distinct risk/reward profiles. Although both companies operate in market segments with substantial growth potential, the critical determinant lies in their long-term capability to harness this potential. In this analysis, I highlight the prospective advantages and opportunities these companies can seize through their investments and advancements in AI. Both peers possess significant opportunities to capitalize on their existing portfolios and innovate new solutions, expanding the utility of their products and services for their current customer base while potentially gaining substantial additional market shares. However, each pioneering company faces notable risks, compounded by heightened competitive pressures from other global players, intensifying the competition to establish its technological dominance.

When examining the two product portfolios, it becomes apparent that each possesses strengths and weaknesses. These factors include vulnerability to overdependence on a single income stream, sensitivity to potential economic downturns, and the ability to innovate and establish new standards in the dynamically evolving technology sector. In terms of financial strength, both companies demonstrate a robust profile, boasting substantial positive ROIC and high current and projected profitability levels. Additionally, they consistently return substantial and regular profits to their investors.

AI chatbots like ChatGPT are a new technology with much space for improvement. In a accurate research, Patronus AI highlighted the incapacity of AI models such as OpenAI's GTP-4 and GPT-4-Turbo, Anthrophic's Claude 2, or Meta Platform's (META) Llama 2, to correctly interpret SEC filings, with a margin of error reaching 81%. The hype around ChatGPT since its introduction to the public in 2022 could likely follow the dynamic of the Gartner Hype Cycle. Microsoft's investment in OpenAI and the general enthusiasm around its chatbot capabilities have led to a substantial surge in its stock price. Still, as Gartner's model describes, after an initial peak of inflated expectations, the interest wanes, and implementations fail to deliver, leading to a distilled market presence of optimized technologies and efficient solutions if the provider continues to Strengthen their products. Alphabet has the potential to revolutionize how users interact and benefit from the company's products and services, owns massive resources, is the most data-rich company in the world, and billions of people will continue to adopt its solutions as their dependency on Google's ecosystem is deeply rooted in their private and professional life. With Gemini, the company is ready to take on OpenAI's AI model, having demonstrated offering a more comprehensive multimodal experience with better results in mathematical reasoning, coding, image and video understanding, and audio processing while having space to Strengthen in intuitive everyday contexts. Gemini's large-scale adoption will trigger another innovation cycle in the industry and start a new era for Google's customers and inventors.

While I consider both companies appealing regarding their technologies and potential, my current stance designates GOOG as a buy and categorizes MSFT as a hold position. This decision stems from the perception that Microsoft's stock appears overpriced, with accurate gains already factoring in much of the foreseeable potential. Considering all factors, Alphabet presents more favorable opportunities with a lower risk profile. Additionally, when evaluating all three forecasted scenarios, Alphabet emerges as a strong stock choice for long-term-oriented investors interested in artificial intelligence.

Editor's Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.

Managing a busy schedule can be overwhelming, but the AI assistant Copilot for Microsoft 365 offers a helping hand. It simplifies the process of sorting and prioritizing meetings, providing concise summaries and highlighting important action items harnessing the power of artificial intelligence.

Offering a wealth of features to users that can help you stay on top of your commitments and can tackle complex issues with confidence. With Copilot, you’ll have a better understanding of your meetings’ outcomes, allowing you to act decisively and effectively. This quick guide provides five tips and tricks you can use to Strengthen your productivity, communication and business meetings using the AI Copilot from Microsoft.

Communication is the backbone of any successful organization, and Copilot acts as your personal editor. It enhances your messages by emphasizing key points, clarifying any ambiguities, and broadening your perspective. Whether you’re working on a detailed report or developing a policy, Copilot ensures that your communication is clear and impactful, resonating with your intended audience.

MS Office AI Assistant

When it comes to dealing with the media, being well-prepared is crucial. Copilot assists in this area by anticipating potential interview questions, creating comprehensive FAQs, and helping you craft responses that sound natural and confident. This level of preparation enables you to represent your organization’s views effectively, protecting its reputation in the public eye.

5 Microsoft 365 Copilot tips & tricks

1. Streamlining Meetings and Interviews Navigating the maze of meetings and interviews can be daunting. With Copilot in Teams, you can effortlessly prioritize your most significant meetings and quickly catch up on missed ones. The AI-powered tool offers concise summaries of discussions, highlighting action items and unresolved decisions. It aids in recalling specific details from conversations, providing precise feedback, and even strategizing on complex topics. Imagine asking Copilot to outline the pros and cons of a strategy in a table, or to recall a specific quote from an interview – it’s a game-changer for efficient communication.

2. Message Testing with Military Precision Clarity in communication is not just a corporate necessity but a strategic imperative, as exemplified by Napoleon’s practice of involving a corporal in military plan assessments. Copilot acts as your modern-day corporal, offering fresh perspectives. Whether it’s refining key messages in a blog, challenging statements on complex issues like sustainability, or brainstorming, Copilot is your go-to for clear, thoughtful positioning.

3. Preparing Spokespeople for the Spotlight For spokespeople facing the media, preparation is key. Copilot assists in anticipating questions and developing FAQs, simulating interactions with tech reporters or PR professionals. It helps in drafting responses that are not only informative but also engaging and conversational, ensuring spokespeople are well-prepared for any press interaction.

4. Enhancing Writing Skills in Communications Even the most skilled writers can benefit from a little assistance. Copilot serves as a virtual writing partner, helping to initiate, continue, and refine your content. Whether it’s rephrasing a tricky paragraph, drafting a communications plan, or crafting a compelling conclusion to a blog post, Copilot is there to enhance your writing prowess. And with sensitive information remaining protected, it’s a safe and reliable aid.

5. Transforming Documents into Engaging Presentations Creating compelling presentations is a crucial part of conveying ideas. Copilot simplifies this process by converting Word documents, like PR plans, into PowerPoint presentations. It allows for customization, such as changing fonts, colors, and images, significantly reducing the time and effort required in presentation design.

Leverage Copilot for Enhanced Productivity If you’re looking to streamline your work process and enhance productivity, Copilot for Microsoft 365 is your ally. It not only simplifies complex tasks but also provides insightful perspectives, making it an essential tool in your professional arsenal. With Copilot, you can focus more on the content and less on the mechanics of communication and presentation.

You will be pleased to know that with Copilot, tasks that once seemed daunting become manageable, allowing you to allocate your time and resources more effectively. Whether you’re a seasoned professional or just starting, Copilot’s intuitive and user-friendly interface makes it easy to integrate into your workflow. So, if you’re wondering how to elevate your productivity game, Copilot for Microsoft 365 is a solution worth exploring.

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On Dec. 19, a federal judge permitted a lawsuit to proceed with four claims against Microsoft and Qualtrics related to the two companies' acquisition of private health data from Oakland, Calif.-based Kaiser Permanente patients. 

The original lawsuit, filed in May, alleges that Microsoft and Qualtrics violated the privacy rights of Kaiser patients under HIPAA. The anonymous lead plaintiff alleges that the companies used pixel codes on Kaiser's patient portal to collect information about her search history, healthcare appointments, medical records and communications with physicians.

The plaintiff says this was done without obtaining consent from website users, according to the original lawsuit. 

Microsoft denied these claims, stating that its tracking service prioritizes privacy by requiring website operators using the code to adhere to consent requirements and by disclosing Microsoft's user data collection through the operator's privacy policy. Microsoft also cited Kaiser's public privacy statement, asserting that Kaiser records data from website users and may disclose personal information to third parties to Strengthen business activities.

Qualtrics also emphasized that it doesn't sell user data or use it for advertising. Qualtrics additionally argued that the Kaiser data is anonymous due to a randomized alphanumeric string assigned to all users.

U.S. District Judge John C. Coughenour's ruling on Dec. 19 dismisses claims of computer fraud, statutory larceny, conversion and two counts under the California Invasion of Privacy Act related to intentional wiretapping. Remaining claims include unjust enrichment, invasion of privacy, violations of California’s Unfair Competition Law, and the state's constitutional right to privacy.