Oracle announced today that it's adding "more than 200" new AI features to its NetSuite software, promising higher productivity in finance and accounting, supply chain and operations, sales and marketing, and customer service tasks.

Why it matters: Instead of charging customers extra for AI features, Oracle is treating these product improvements as table stakes, setting up a showdown with rivals who are charging a premium for similar services.

• Oracle is also positioning itself as a practical AI provider, meeting customer demands for productivity boosts rather than delivering features with a wow factor.

"AI is going to be everywhere — it's not something that you're going to turn on or off," so there's no point making it harder or more expensive for customers to use it, Oracle NetSuite EVP Evan Goldberg tells Axios.

The big picture: Rapid adoption of AI over the past 18 months might be putting the U.S. economy on the cusp of a productivity boom.

How it works: One NetSuite Text Enhance feature with wide applications is "assisted authoring."

• The tools will, for example, summarize financial data, prepare job descriptions and draft vendor engagement letters or lead-generation emails.
• Oracle says it focused on how to make AI work for midsize companies. An "analytics warehouse" can now mash up and analyze data across many internal data systems, saving companies the hassle of streamlining them.
• Oracle promises that "no customer data is shared with large language model providers or seen by other customers."

Context: NetSuite is one of the two software suites that Oracle offers to manage an organization's business.

• Rivals such as Salesforce and Microsoft incorporated generative AI into their CRM software beginning in March 2023.
• Other enterprise vendors such as Box have added generative AI tools to their offerings without boosting prices.

Friction point: SAP CEO Christian Klein told Axios in 2023 that the company plans to charge around 30% more to customers who use its AI features. SAP is one of Oracle's main competitors.

• Oracle's Goldberg tells Axios it doesn't make sense to charge a premium for AI: "You can't imagine these business systems without AI in the future. It would be like a car without wheels."

The intrigue: Oracle has been trialing generative AI features in some parts of NetSuite since October 2023, fine-tuning them based on anonymized but "incredibly rich data" on how customers used them.

• The feedback included data from an "undo" button, which acted as a proxy for user dissatisfaction with answers to AI prompts.

What they're saying: Goldberg says Oracle isn't planning to get into AI model development, but will pursue traditional AI methods like predictive analytics.

• Goldberg is a fan of "very straightforward use of machine learning" and says his goal with the AI features has been to "make it obviously useful and correct enough of the time that you don't want to turn it off."

What's next: Goldberg says the next step is to find new ways to help leverage customer data.

• One way is to nudge customers with messages like, "We noticed that users like you tend to like having this metric on your dashboard, maybe you'd like to have that metric," he says.
• Goldberg thinks we'll also see different types of AI grafted together: for example, using retrieval-augmented generation to provide citations for a chatbot's answers or using LLMs to present predictive analytics in new ways.

The bottom line: "There's a very long road ahead. We're only one year into this revolution. It's as big as the internet revolution," he says.

The U.S. Office of Management and Budget this morning issued governmentwide policy for mitigating AI risks, a major part of President Biden's AI executive order, Axios Pro's Ashley Gold reports.

Why it matters: Agencies across the federal government now have specific guidance on how to use AI in their work, and how to ward off its risks.

• "President Biden and I intend that these domestic policies will serve as a model for global action," Vice President Kamala Harris said on a call with reporters.
• This was one of the tasks due today, 150 days after Biden issued the AI Executive Order.
• The White House says federal agencies completed all 150-day actions required in the executive order.

What's inside: The guidance focuses on the privacy and safety of the public, transparency in processes and how AI can make government services easier to access, Harris said.

• By Dec. 1, agencies must "implement concrete safeguards when using AI in a way that could impact Americans' rights of safety," including being able to opt out of TSA facial recognition, per a White House fact sheet.
• Companies that want to contract with the federal government to sell their AI systems will have to meet certain specifications based on the guidance.

Between the lines: The guidance also encourages agencies to use AI to try to solve problems around climate change, public health and transportation safety by lifting some bureaucratic barriers.

• It aggressively directs agencies to "upskill their AI talent" and includes a commitment to hire 100 AI professionals by this summer.

A version of this story was published first on Axios Pro. Unlock more news like this by talking to our sales team.

• Claude 3 from Anthropic is surpassing OpenAI's GPT-4 in Chatbot Arena, a leading model ranking service. (ArsTechnica)
• Databricks unveiled an open source LLM that the company says is more powerful than Meta's Llama 2, Mistral's Mixtral and X.ai's Grok. (Wired)
• Amazon added $2.75 billion to its Anthropic investment, completing a deal announced in 2023. (CNBC)
• Giant AI models are trained on giant data sets that, increasingly, are curated by other AI models — introducing feedback loops that add new kinds of bias and error. (Knowing Machines)
• Kansas is set to enact an extreme age-verification law for accessing adult content. (404 Media)
• Trading places: Mikhail Parakhin, head of Microsoft's Bing search engine and advertising, will exit that role on the heels of Mustafa Suleyman arriving as CEO of Microsoft AI. Also, Morgan Klaus Scheuerman joined Sony's AI ethics team as its human-computer interaction researcher.

Who wants a round of refreshing, data-driven beer?