Now in Foundry: Qwen3-Coder-Next, Qwen3-ASR-1.7B, Z-Image
This week's spotlight features three models from that demonstrate enterprise-grade AI across the full scope of modalities. From low latency coding agents to state-of-the-art multilingual speech recognition and foundation-quality image generation, these models showcase the breadth of innovation happening in open-source AI. Each model balances performance with practical deployment considerations, making them viable for production systems while pushing the boundaries of what's possible in their respective domains. This week's Model Mondays edition highlights Qwen3-Coder-Next, an 80B MoE model that activates only 3B parameters while delivering coding agent capabilities with 256k context; Qwen3-ASR-1.7B, which achieves state-of-the-art accuracy across 52 languages and dialects; and Z-Image from Tongyi-MAI, an undistilled text-to-image foundation model with full Classifier-Free Guidance support for professional creative workflows. Models of the week Qwen: Qwen3-Coder-Next Model Specs Parameters / size: 80B total (3B activated) Context length: 262,144 tokens Primary task: Text generation (coding agents, tool use) Why it's interesting Extreme efficiency: Activates only 3B of 80B parameters while delivering performance comparable to models with 10-20x more active parameters, making advanced coding agents viable for local deployment on consumer hardware Built for agentic workflows: Excels at long-horizon reasoning, complex tool usage, and recovering from execution failures, a critical capability for autonomous development that go beyond simple code completion Benchmarks: Competitive performance with significantly larger models on SWE-bench and coding benchmarks (Technical Report) Try it Use Case Prompt Pattern Code generation with tool use Provide task context, available tools, and execution environment details Long-context refactoring Include full codebase context within 256k window with specific refactoring goals Autonomous debugging Present error logs, stack traces, and relevant code with failure recovery instructions Multi-file code synthesis Describe architecture requirements and file structure expectations Financial services sample prompt: You are a coding agent for a fintech platform. Implement a transaction reconciliation service that processes batches of transactions, detects discrepancies between internal records and bank statements, and generates audit reports. Use the provided database connection tool, logging utility, and alert system. Handle edge cases including partial matches, timing differences, and duplicate transactions. Include unit tests with 90%+ coverage. Qwen: Qwen3-ASR-1.7B Model Specs Parameters / size: 1.7B Context length: 256 tokens (default), configurable up to 4096 Primary task: Automatic speech recognition (multilingual) Why it's interesting All-in-one multilingual capability: Single 1.7B model handles language identification plus speech recognition for 30 languages, 22 Chinese dialects, and English accents from multiple regions—eliminating the need to manage separate models per language Specialized audio versatility: Transcribes not just clean speech but singing voice, songs with background music, and extended audio files, expanding use cases beyond traditional ASR to entertainment and media workflows State-of-the-art accuracy: Outperforms GPT-4o, Gemini-2.5, and Whisper-large-v3 across multiple benchmarks. English: Tedlium 4.50 WER vs 7.69/6.15/6.84; Chinese: WenetSpeech 4.97/5.88 WER vs 15.30/14.43/9.86 (Technical Paper) Language ID included: 97.9% average accuracy across benchmark datasets for automatic language identification, eliminating the need for separate language detection pipelines Try it Use Case Prompt Pattern Multilingual transcription Send audio files via API with automatic language detection Call center analytics Process customer service recordings to extract transcripts and identify languages Content moderation Transcribe user-generated audio content across multiple languages Meeting transcription Convert multilingual meeting recordings to text for documentation Customer support sample prompt: Deploy Qwen3-ASR-1.7B to a Microsoft Foundry endpoint and transcribe multilingual customer service calls. Send audio files via API to automatically detect the language (from 52 supported options including 30 languages and 22 Chinese dialects) and generate accurate transcripts. Process calls from customers speaking English, Spanish, Mandarin, Cantonese, Arabic, French, and other languages without managing separate models per language. Use transcripts for quality assurance, compliance monitoring, and customer sentiment analysis. Tongyi-MAI: Z-Image Model Specs Parameters / size: 6B Context length: N/A (text-to-image) Primary task: Text-to-image generation Why it's interesting Undistilled foundation model: Full-capacity base without distillation preserves complete training signal with Classifier-Free Guidance support (a technique that improves prompt adherence and output quality), enabling complex prompt engineering and negative prompting that distilled models cannot achieve High output diversity: Generates distinct character identities in multi-person scenes with varied compositions, facial features, and lighting, critical for creative applications requiring visual variety rather than consistency Aesthetic versatility: Handles diverse visual styles from hyper-realistic photography to anime and stylized illustrations within a single model, supporting resolutions from 512×512 to 2048×2048 at any aspect ratio with 28-50 inference steps (Technical Paper) Try it Use Case Prompt Pattern Multilingual transcription Send audio files via API with automatic language detection Call center analytics Process customer service recordings to extract transcripts and identify languages Content moderation Transcribe user-generated audio content across multiple languages Meeting transcription Convert multilingual meeting recordings to text for documentation E-commerce sample prompt: Professional product photography of a modern ergonomic office chair in a bright Scandinavian-style home office. Natural window lighting from left, clean white desk with laptop and succulent plant, light oak hardwood floor. Chair positioned at 45-degree angle showing design details. Photorealistic, commercial photography, sharp focus, 85mm lens, f/2.8, soft shadows. Getting started You can deploy open‑source Hugging Face models directly in Microsoft Foundry by browsing the Hugging Face collection in the Foundry model catalog and deploying to managed endpoints in just a few clicks. You can also start from the Hugging Face Hub. First, select any supported model and then choose "Deploy on Microsoft Foundry", which brings you straight into Azure with secure, scalable inference already configured. Learn how to discover models and deploy them using Microsoft Foundry documentation. Follow along the Model Mondays series and access the GitHub to stay up to date on the latest Read Hugging Face on Azure docs Learn about one-click deployments from the Hugging Face Hub on Microsoft Foundry Explore models in Microsoft FoundryWhat is trending in Hugging Face on Microsoft Foundry? Feb, 2, 2026
Open‑source AI is moving fast, with important breakthroughs in reasoning, agentic systems, multimodality, and efficiency emerging every day. Hugging Face has been a leading platform where researchers, startups, and developers share and discover new models. Microsoft Foundry brings these trending Hugging Face models into a production‑ready experience, where developers can explore, evaluate, and deploy them within their Azure environment. Our weekly Model Monday’s series highlights Hugging Face models available in Foundry, focusing on what matters most to developers: why a model is interesting, where it fits, and how to put it to work quickly. This week’s Model Mondays edition highlights three Hugging Face models, including a powerful Mixture-of-Experts model from Z. AI designed for lightweight deployment, Meta’s unified foundation model for image and video segmentation, and MiniMax’s latest open-source agentic model optimized for complex workflows. Models of the week Z.AI’s GLM-4.7-flash Model Basics Model name: zai-org/GLM-4.7-Flash Parameters / size: 30B total -3B active Default settings: 131,072 max new tokens Primary task: Agentic, Reasoning and Coding Why this model matters Why it’s interesting: It utilizes a Mixture-of-Experts (MoE) architecture (30B total parameters and 3B active parameters) to offer a new option for lightweight deployment. It demonstrates strong performance on logic and reasoning benchmarks, outperforming similar sized models like gpt-oss-20b on AIME 25 and GPQA benchmarks. It supports advanced inference features like "Preserved Thinking" mode for multi-turn agentic tasks. Best‑fit use cases: Lightweight local deployment, multi-turn agentic tasks, and logical reasoning applications. What’s notable: From the Foundry catalog, users can deploy on a A100 instance or unsloth/GLM-4.7-Flash-GGUF on a CPU. ource SOTA scores among models of comparable size. Additionally, compared to similarly sized models, GLM-4.7-Flash demonstrates superior frontend and backend development capabilities. Click to see more: https://docs.z.ai Try it Use case Best‑practice prompt pattern Agentic coding (multi‑step repo work, debugging, refactoring) Treat the model as an autonomous coding agent, not a snippet generator. Explicitly require task decomposition and step‑by‑step execution, then a single consolidated result. Long‑context agent workflows (local or low‑cost autonomous agents) Call out long‑horizon consistency and context preservation. Instruct the model to retain earlier assumptions and decisions across turns. Now that you know GLM‑4.7‑Flash works best when you give it a clear goal and let it reason through a bounded task, here’s an example prompt that a product or engineering team might use to identify risks and propose mitigations: You are a software reliability analyst for a mid‑scale SaaS platform. Review recent incident reports, production logs, and customer issues to uncover edge‑case failures outside normal usage (e.g., rare inputs, boundary conditions, timing/concurrency issues, config drift, or unexpected feature interactions). Prioritize low‑frequency, high‑impact risks that standard testing misses. Recommend minimal, low‑cost fixes (validation, guardrails, fallback logic, or documentation). Deliver a concise executive summary with sections: Observed Edge Cases, Root Causes, User Impact, Recommended Lightweight Fixes, and Validation Steps. Meta's Segment Anything 3 (SAM3) Model Basics Model name: facebook/sam3 Parameters / size: 0.9B Primary task: Mask Generation, Promptable Concept Segmentation (PCS) Why this model matters Why it’s interesting: It handles a vastly larger set of open-vocabulary prompts than SAM 2, and unifies image and video segmentation capabilities. It includes a "SAM 3 Tracker" mode that acts as a drop-in replacement for SAM 2 workflows with improved performance. Best‑fit use cases: Open-vocabulary object detection, video object tracking, and automatic mask generation What’s notable: Introduces Promptable Concept Segmentation (PCS), allowing users to find all matching objects (e.g., "dial") via text prompt rather than just single instances. Try it This model enables users to identify specific objects within video footage and isolate them over extended periods. With just one line of code, it is possible to detect multiple similar objects simultaneously. The accompanying GIF demonstrates how SAM3 efficiently highlights players wearing white on the field as they appear and disappear from view. Additional examples are available at the following repository: https://github.com/facebookresearch/sam3/blob/main/assets/player.gif Use case Best‑practice prompt pattern Agentic coding (multi‑step repo work, debugging, refactoring) Treat SAM 3 as a concept detector, not an interactive click tool. Use short, concrete noun‑phrase concept prompts instead of describing the scene or asking questions. Example prompt: “yellow school bus” or “shipping containers”. Avoid verbs or full sentences. Video segmentation + object tracking Specify the same concept prompt once, then apply it across the video sequence. Do not restate the prompt per frame. Let the model maintain identity continuity. Example: “person wearing a red jersey”. Hard‑to‑name or visually subtle objects Use exemplar‑based prompts (image region or box) when text alone is ambiguous. Optionally combine positive and negative exemplars to refine the concept. Avoid over‑constraining with long descriptions. Using the GIF above as a leading example, here is a prompt that shows how SAM 3 turns raw sports footage into structured, reusable data. By identifying and tracking players based on visual concepts like jersey color so that sports leagues can turn tracked data into interactive experiences where automated player identification can relay stats, fun facts, etc when built into a larger application. Here is a prompt that will allow you to start identifying specific players across video: Act as a sports analytics operator analyzing football match footage. Segment and track all football players wearing blue jerseys across the video. Generate pixel‑accurate segmentation masks for each player and assign persistent instance IDs that remain stable during camera movement, zoom, and player occlusion. Exclude referees, opposing team jerseys, sidelines, and crowd. Output frame‑level masks and tracking metadata suitable for overlays, player statistics, and downstream analytics pipelines. MiniMax AI's MiniMax-M2.1 Model Basics Model name: MiniMaxAI/MiniMax-M2.1 Parameters / size: 229B-10B Active Default settings: 200,000 max new tokens Primary task: Agentic and Coding Why this model matters Why it’s interesting: It is optimized for robustness in coding, tool use, and long-horizon planning, outperforming Claude Sonnet 4.5 in multilingual scenarios. It excels in full-stack application development, capable of architecting apps "from zero to one”. Previous coding models focused on Python optimization, M2.1 brings enhanced capabilities in Rust, Java, Golang, C++, Kotlin, Objective-C, TypeScript, JavaScript, and other languages. The model delivers exceptional stability across various coding agent frameworks. Best‑fit use cases: Lightweight local deployment, multi-turn agentic tasks, and logical reasoning applications. What’s notable: The release of open-source weights for M2.1 delivers a massive leap over M2 on software engineering leaderboards. https://www.minimax.io/ Try it Use case Best‑practice prompt pattern End‑to‑end agentic coding (multi‑file edits, run‑fix loops) Treat the model as an autonomous coding agent, not a snippet generator. Explicitly require task decomposition and step‑by‑step execution, then a single consolidated result. Long‑horizon tool‑using agents (shell, browser, Python) Explicitly request stepwise planning and sequential tool use. M2.1’s interleaved thinking and improved instruction‑constraint handling are designed for complex, multi‑step analytical tasks that require evidence tracking and coherent synthesis, not conversational back‑and‑forth. Long‑context reasoning & analysis (large documents / logs) Declare the scope and desired output structure up front. MiniMax‑M2.1 performs best when the objective and final artifact are clear, allowing it to manage long context and maintain coherence. Because MiniMax‑M2.1 is designed to act as a long‑horizon analytical agent, it shines when you give it a clear end goal and let it work through large volumes of information—here’s a prompt a risk or compliance team could use in practice: You are a financial risk analysis agent. Analyze the following transaction logs and compliance policy documents to identify potential regulatory violations and systemic risk patterns. Plan your approach before executing. Work through the data step by step, referencing evidence where relevant. Deliver a final report with the following sections: Key Risk Patterns Identified, Supporting Evidence, Potential Regulatory Impact, Recommended Mitigations. Your response should be a complete, executive-ready report, not a conversational draft. Getting started You can deploy open‑source Hugging Face models directly in Microsoft Foundry by browsing the Hugging Face collection in the Foundry model catalog and deploying to managed endpoints in just a few clicks. You can also start from the Hugging Face Hub. First, select any supported model and then choose "Deploy on Microsoft Foundry", which brings you straight into Azure with secure, scalable inference already configured. Learn how to discover models and deploy them using Microsoft Foundry documentation. Follow along the Model Mondays series and access the GitHub to stay up to date on the latest Read Hugging Face on Azure docs Learn about one-click deployments from the Hugging Face Hub on Microsoft Foundry Explore models in Microsoft FoundryPublishing Agents from Microsoft Foundry to Microsoft 365 Copilot & Teams
Better Together is a series on how Microsoft’s AI platforms work seamlessly to build, deploy, and manage intelligent agents at enterprise scale. As organizations embrace AI across every workflow, Microsoft Foundry, Microsoft 365, Agent 365, and Microsoft Copilot Studio are coming together to deliver a unified approach—from development to deployment to day-to-day operations. This three-part series explores how these technologies connect to help enterprises build AI agents that are secure, governed, and deeply integrated with Microsoft’s product ecosystem. Series Overview Part 1: Publishing from Foundry to Microsoft 365 Copilot and Microsoft Teams Part 2: Foundry + Agent 365 — Native Integration for Enterprise AI Part 3: Microsoft Copilot Studio Integration with Foundry Agents This blog focuses on Part 1: Publishing from Foundry to Microsoft 365 Copilot—how developers can now publish agents built in Foundry directly to Microsoft 365 Copilot and Teams in just a few clicks. Build once. Publish everywhere. Developers can now take an AI agent built in Microsoft Foundry and publish it directly to Microsoft 365 Copilot and Microsoft Teams in just a few clicks. The new streamlined publishing flow eliminates manual setup across Entra ID, Azure Bot Service, and manifest files, turning hours of configuration into a seamless, guided flow in the Foundry Playground. Simplifying Agent Publishing for Microsoft 365 Copilot & Microsoft Teams Previously, deploying a Foundry AI agent into Microsoft 365 Copilot and Microsoft Teams required multiple steps: app registration, bot provisioning, manifest editing, and admin approval. With the new Foundry → M365 integration, the process is straightforward and intuitive. Key capabilities No-code publishing — Prepare, package, and publish agents directly from Foundry Playground. Unified build — A single agent package powers multiple Microsoft 365 channels, including Teams Chat, Microsoft 365 Copilot Chat, and BizChat. Agent-type agnostic — Works seamlessly whether you have a prompt agent, hosted agent, or workflow agent. Built-in Governance — Every agent published to your organization is automatically routed through Microsoft 365 Admin Center (MAC) for review, approval, and monitoring. Downloadable package — Developers can download a .zip for local testing or submission to the Microsoft Marketplace. For pro-code developers, the experience is also simplified. A C# code-first sample in the Agent Toolkit for Visual Studio is searchable, featured, and ready to use. Why It Matters This integration isn’t just about convenience; it’s about scale, control, and trust. Faster time to value — Deliver intelligent agents where people already work, without infrastructure overhead. Enterprise control — Admins retain full oversight via Microsoft 365 Admin Center, with built-in approval, review and governance flows. Developer flexibility — Both low-code creators and pro-code developers benefit from the unified publishing experience. Better Together — This capability lays the groundwork for Agent 365 publishing and deeper M365 integrations. Real-world scenarios YoungWilliams built Priya, an AI agent that helps handle government service inquiries faster and more efficiently. Using the one-click publishing flow, Priya was quickly deployed to Microsoft Teams and M365 Copilot without manual setup. This allowed Young Williams’ customers to provide faster, more accurate responses while keeping governance and compliance intact. “Integrating Microsoft Foundry with Microsoft 365 Copilot fundamentally changed how we deliver AI solutions to our government partners,” said John Tidwell, CTO of YoungWilliams. “With Foundry’s one-click publishing to Teams and Copilot, we can take an idea from prototype to production in days instead of weeks—while maintaining the enterprise-grade security and governance our clients expect. It’s a game changer for how public services can adopt AI responsibly and at scale.” Availability Publishing from Foundry to M365 is in Public Preview within the Foundry Playground. Developers can explore the preview in Microsoft Foundry and test the Teams / M365 publishing flow today. SDK and CLI extensions for code-first publishing are generally available. What’s Next in the Better Together Series This blog is part of the broader Better Together series connecting Microsoft Foundry, Microsoft 365, Agent 365, and Microsoft Copilot Studio. Continue the journey: Foundry + Agent 365 — Native Integration for Enterprise AI (Link) Start building today [Quickstart — Publish an Agent to Microsoft 365 ] Try it now in the new Foundry PlaygroundAdvanced Function Calling and Multi-Agent Systems with Small Language Models in Foundry Local
Advanced Function Calling and Multi-Agent Systems with Small Language Models in Foundry Local In our previous exploration of function calling with Small Language Models, we demonstrated how to enable local SLMs to interact with external tools using a text-parsing approach with regex patterns. While that method worked, it required manual extraction of function calls from the model's output; functional but fragile. Today, I'm excited to show you something far more powerful: Foundry Local now supports native OpenAI-compatible function calling with select models. This update transforms how we build agentic AI systems locally, making it remarkably straightforward to create sophisticated multi-agent architectures that rival cloud-based solutions. What once required careful prompt engineering and brittle parsing now works seamlessly through standardized API calls. We'll build a complete multi-agent quiz application that demonstrates both the elegance of modern function calling and the power of coordinated agent systems. The full source code is available in this GitHub repository, but rather than walking through every line of code, we'll focus on how the pieces work together and what you'll see when you run it. What's New: Native Function Calling in Foundry Local As we explored in our guide to running Phi-4 locally with Foundry Local, we ran powerful language models on our local machine. The latest version now support native function calling for models specifically trained with this capability. The key difference is architectural. In our weather assistant example, we manually parsed JSON strings from the model's text output using regex patterns and frankly speaking, meticulously testing and tweaking the system prompt for the umpteenth time 🙄. Now, when you provide tool definitions to supported models, they return structured tool_calls objects that you can directly execute. Currently, this native function calling capability is available for the Qwen 2.5 family of models in Foundry Local. For this tutorial, we're using the 7B variant, which strikes a great balance between capability and resource requirements. Quick Setup Getting started requires just a few steps. First, ensure you have Foundry Local installed. On Windows, use winget install Microsoft.FoundryLocal , and on macOS, use bash brew install microsoft/foundrylocal/foundrylocal You'll need version 0.8.117 or later. Install the Python dependencies in the requirements file, then start your model. The first run will download approximately 4GB: foundry model run qwen2.5-7b-instruct-cuda-gpu If you don't have a compatible GPU, use the CPU version instead, or you can specify any other Qwen 2.5 variant that suits your hardware. I have set a DEFAULT_MODEL_ALIAS variable you can modify to use different models in utils/foundry_client.py file. Keep this terminal window open. The model needs to stay running while you develop and test your application. Understanding the Architecture Before we dive into running the application, let's understand what we're building. Our quiz system follows a multi-agent architecture where specialized agents handle distinct responsibilities, coordinated by a central orchestrator. The flow works like this: when you ask the system to generate a quiz about photosynthesis, the orchestrator agent receives your message, understands your intent, and decides which tool to invoke. It doesn't try to generate the quiz itself, instead, it calls a tool that creates a specialist QuizGeneratorAgent focused solely on producing well-structured quiz questions. Then there's another agent, reviewAgent, that reviews the quiz with you. The project structure reflects this architecture: quiz_app/ ├── agents/ # Base agent + specialist agents ├── tools/ # Tool functions the orchestrator can call ├── utils/ # Foundry client connection ├── data/ ├── quizzes/ # Generated quiz JSON files │── responses/ # User response JSON files └── main.py # Application entry point The orchestrator coordinates three main tools: generate_new_quiz, launch_quiz_interface, and review_quiz_interface. Each tool either creates a specialist agent or launches an interactive interface (Gradio), handling the complexity so the orchestrator can focus on routing and coordination. How Native Function Calling Works When you initialize the orchestrator agent in main.py, you provide two things: tool schemas that describe your functions to the model, and a mapping of function names to actual Python functions. The schemas follow the OpenAI function calling specification, describing each tool's purpose, parameters, and when it should be used. Here's what happens when you send a message to the orchestrator: The agent calls the model with your message and the tool schemas. If the model determines a tool is needed, it returns a structured tool_calls attribute containing the function name and arguments as a proper object—not as text to be parsed. Your code executes the tool, creates a message with "role": "tool" containing the result, and sends everything back to the model. The model can then either call another tool or provide its final response. The critical insight is that the model itself controls this flow through a while loop in the base agent. Each iteration represents the model examining the current state, deciding whether it needs more information, and either proceeding with another tool call or providing its final answer. You're not manually orchestrating when tools get called; the model makes those decisions based on the conversation context. Seeing It In Action Let's walk through a complete session to see how these pieces work together. When you run python main.py, you'll see the application connect to Foundry Local and display a welcome banner: Now type a request like "Generate a 5 question quiz about photosynthesis." Watch what happens in your console: The orchestrator recognized your intent, selected the generate_new_quiz tool, and extracted the topic and number of questions from your natural language request. Behind the scenes, this tool instantiated a QuizGeneratorAgent with a focused system prompt designed specifically for creating quiz JSON. The agent used a low temperature setting to ensure consistent formatting and generated questions that were saved to the data/quizzes folder. This demonstrates the first layer of the multi-agent architecture: the orchestrator doesn't generate quizzes itself. It recognizes that this task requires specialized knowledge about quiz structure and delegates to an agent built specifically for that purpose. Now request to take the quiz by typing "Take the quiz." The orchestrator calls a different tool and Gradio server is launched. Click the link to open in a browser window displaying your quiz questions. This tool demonstrates how function calling can trigger complex interactions—it reads the quiz JSON, dynamically builds a user interface with radio buttons for each question, and handles the submission flow. After you answer the questions and click submit, the interface saves your responses to the data/responses folder and closes the Gradio server. The orchestrator reports completion: The system now has two JSON files: one containing the quiz questions with correct answers, and another containing your responses. This separation of concerns is important—the quiz generation phase doesn't need to know about response collection, and the response collection doesn't need to know how quizzes are created. Each component has a single, well-defined responsibility. Now request a review. The orchestrator calls the third tool: A new chat interface opens, and here's where the multi-agent architecture really shines. The ReviewAgent is instantiated with full context about both the quiz questions and your answers. Its system prompt includes a formatted view of each question, the correct answer, your answer, and whether you got it right. This means when the interface opens, you immediately see personalized feedback: The Multi-Agent Pattern Multi-agent architectures solve complex problems by coordinating specialized agents rather than building monolithic systems. This pattern is particularly powerful for local SLMs. A coordinator agent routes tasks to specialists, each optimized for narrow domains with focused system prompts and specific temperature settings. You can use a 1.7B model for structured data generation, a 7B model for conversations, and a 4B model for reasoning, all orchestrated by a lightweight coordinator. This is more efficient than requiring one massive model for everything. Foundry Local's native function calling makes this straightforward. The coordinator reliably invokes tools that instantiate specialists, with structured responses flowing back through proper tool messages. The model manages the coordination loop—deciding when it needs another specialist, when it has enough information, and when to provide a final answer. In our quiz application, the orchestrator routes user requests but never tries to be an expert in quiz generation, interface design, or tutoring. The QuizGeneratorAgent focuses solely on creating well-structured quiz JSON using constrained prompts and low temperature. The ReviewAgent handles open-ended educational dialogue with embedded quiz context and higher temperature for natural conversation. The tools abstract away file management, interface launching, and agent instantiation, the orchestrator just knows "this tool launches quizzes" without needing implementation details. This pattern scales effortlessly. If you wanted to add a new capability like study guides or flashcards, you could just easily create a new tool or specialists. The orchestrator gains these capabilities automatically by having the tool schemas you have defined without modifying core logic. This same pattern powers production systems with dozens of specialists handling retrieval, reasoning, execution, and monitoring, each excelling in its domain while the coordinator ensures seamless collaboration. Why This Matters The transition from text-parsing to native function calling enables a fundamentally different approach to building AI applications. With text parsing, you're constantly fighting against the unpredictability of natural language output. A model might decide to explain why it's calling a function before outputting the JSON, or it might format the JSON slightly differently than your regex expects, or it might wrap it in markdown code fences. Native function calling eliminates this entire class of problems. The model is trained to output tool calls as structured data, separate from its conversational responses. The multi-agent aspect builds on this foundation. Because function calling is reliable, you can confidently delegate to specialist agents knowing they'll integrate smoothly with the orchestrator. You can chain tool calls—the orchestrator might generate a quiz, then immediately launch the interface to take it, based on a single user request like "Create and give me a quiz about machine learning." The model handles this orchestration intelligently because the tool results flow back as structured data it can reason about. Running everything locally through Foundry Local adds another dimension of value and I am genuinely excited about this (hopefully, the phi models get this functionality soon). You can experiment freely, iterate quickly, and deploy solutions that run entirely on your infrastructure. For educational applications like our quiz system, this means students can interact with the AI tutor as much as they need without cost concerns. Getting Started With Your Own Multi-Agent System The complete code for this quiz application is available in the GitHub repository, and I encourage you to clone it and experiment. Try modifying the tool schemas to see how the orchestrator's behavior changes. Add a new specialist agent for a different task. Adjust the system prompts to see how agent personalities and capabilities shift. Think about the problems you're trying to solve. Could they benefit from having different specialists handling different aspects? A customer service system might have agents for order lookup, refund processing, and product recommendations. A research assistant might have agents for web search, document summarization, and citation formatting. A coding assistant might have agents for code generation, testing, and documentation. Start small, perhaps with two or three specialist agents for a specific domain. Watch how the orchestrator learns to route between them based on the tool descriptions you provide. You'll quickly see opportunities to add more specialists, refine the existing ones, and build increasingly sophisticated systems that leverage the unique strengths of each agent while presenting a unified, intelligent interface to your users. In the next entry, we will be deploying our quizz app which will mark the end of our journey in Foundry and SLMs these past few weeks. I hope you are as excited as I am! Thanks for reading.
Introducing Dragon HD Omni: Azure Speech New Voice Type Now in Preview via Microsoft Foundry
Dragon HD Omni is Microsoft Azure Speech’s newest text‑to‑speech generation, delivering over 700 high‑quality voices with enhanced expressiveness, multi‑lingual fluency, and multi‑style control — all through a unified model built in Microsoft Foundry. It removes common developer pain points such as unnatural voice prosody, limited language coverage, and heavy SSML tuning effort. The result is a powerful value proposition: faster integration, richer user experiences, and production‑ready voice output with minimal effort. Azure speech offers a broad range of unique voices for applications like virtual agents, audiobooks, podcasts, and speech-to-speech tasks. Demo video 700+ prebuilt voices Dragon HD Omni offers a range of prebuilt voices with distinct personas and emotions, supporting diverse use cases from agent-based applications to content creation. These voices unlock endless possibilities, empowering users to enhance end-to-end applications. Full update for previous generation voices Dragon HD Omni merges a wide range of prebuilt voices into one, improving contextual adaptation, prosody, expression, and keeping each voice's unique character. This technology delivers more accurate, flexible, and lifelike speech for a variety of uses. Dragon HD Omni raises the standard for natural AI voices across customer service, accessibility, and creative projects, advancing human-computer interaction. You can explore some voices from voice list, such as: "en-US-Ava:DragonHDOmniLatestNeural" "en-US-Andrew:DragonHDOmniLatestNeural" "en-US-Dana:DragonHDOmniLatestNeural" "en-US-Caleb:DragonHDOmniLatestNeural" "zh-CN-Xiaoyue:DragonHDOmniLatestNeural" "zh-CN-Yunqi:DragonHDOmniLatestNeural" "en-US-Phoebe:DragonHDOmniLatestNeural" "en-US-Lewis:DragonHDOmniLatestNeural" They will be available to try directly via Speech Playground - Microsoft Foundry Or, you can use this voice name format by adding the suffix `:DragonHDOmniLatestNeural` to try the Omni version of the given voice via direct SSML call. For example: Previous neural voice Omni version voice name de-DE-ConradNeural de-DE-Conrad:DragonHDOmniLatestNeural AI-Generated Voices Dragon HD Omni now features nearly 300 brand‑new AI‑generated voices, carefully designed to deliver an unprecedented range of vocal diversity. These voices aren’t just more of the same — they’re built to give you choice, flexibility, and creative control. With variations across: Gender – male, female, and non‑binary options Age – youthful, mature, and senior tones Pitch & tone – from warm and friendly to authoritative and professional This expanded library means you can: Personalize experiences for different audiences, whether you’re building an educational app, a customer support bot, or a storytelling platform. Strengthen brand identity by selecting voices that reflect your company’s personality and values. Increase inclusivity with diverse vocal styles that resonate across cultures and communities. Unlock creativity by experimenting with unique voice personalities for podcasts, games, or immersive experiences. Speaker name – Description Sample en-us-graphiterhodium - A bold and dramatic male voice en-us-olivepoivre - An adult female voice that is calm and soothing. Check the full Dragon HD Omni voice list at here. Styles control Standard Azure voices have limited styles due to extensive tuning requirements. The Dragon HD Omni introduces automatic style prediction using natural language descriptions, enabling advanced customization, broader style support, reduced cost, and improved expressiveness. In the initial release, styles will launch for en-US-Ava and en-US-Andrew. Supported styles angry, chill surfer, confused, curious, determined, disgusted, embarrassed, emo teenager, empathetic, encouraging, excited, fearful, friendly, grateful, joyful, mad scientist, meditative, narration, neutral, new yorker, news, reflective, regretful, relieved, sad, santa, shy, soft voice, surprised Note that style result will be strongly influenced by the input content. SSML example <speak version="1.0" xmlns="http://www.w3.org/2001/10/synthesis" xmlns:mstts="http://www.w3.org/2001/mstts" xml:lang="en-US"> <voice name="en-us-ava:DragonHDOmniLatestNeural"> <mstts:express-as style="cheerful"> Wow! What an amazing day! I feel so full of energy, and everything around me seems brighter. My voice is bubbling with excitement, and I can’t stop smiling. I’m ready to take on anything that comes my way—let’s celebrate this wonderful moment together! </mstts:express-as> </voice> </speak> Multilingual and Accents All Dragon HD Omni voices support multiple languages, with the capability that can automatically predicting and generating output based on the input text. Additionally, you may utilize the tag to adjust speaking languages and accents, such as fr-FR for French, de-DE for German, etc. For a comprehensive list of supported languages and their associated syntax and attributes, please refer to the lang element. SSML example <speak version="1.0" xmlns="http://www.w3.org/2001/10/synthesis" xmlns:mstts="http://www.w3.org/2001/mstts" xml:lang="en-US"><voice name="en-us-ava:Dragon HD OmniLatestNeural"><lang xml:lang="fr-FR"> Bonjour ! Ce matin, j’ai pris un café au jardin du Luxembourg. Il faisait frais, mais très agréable. Ensuite, j’ai acheté une baguette et quelques macarons. Paris est vraiment charmant.</lang> </voice> </speak> Word Boundary Event Support Dragon HD Omni supports the word boundary event, which allows developers to track the precise timing of each word as it is spoken. This feature is essential for applications requiring word-level synchronization, such as karaoke, real-time captioning, or interactive voice experiences. When the event fires, it provides: Text: The word spoken AudioOffset: The time offset in the audio stream (milliseconds) TextOffset: The position of the word in the input text Example: Python Sample Using Wordboundary Event in Azure Speech SDK import azure.cognitiveservices.speech as speechsdk def word_boundary_cb(evt): print(f"Word: '{evt.text}', AudioOffset: {evt.audio_offset / 10000}ms, TextOffset: {evt.text_offset}") speech_config = speechsdk.SpeechConfig(subscription="YourSubscriptionKey", region="YourServiceRegion") synthesizer = speechsdk.SpeechSynthesizer(speech_config=speech_config) synthesizer.synthesis_word_boundary.connect(word_boundary_cb) ssml = """ <speak version="1.0" xmlns="http://www.w3.org/2001/10/synthesis" xmlns:mstts="http://www.w3.org/2001/mstts" xml:lang="en-US"> <voice name="en-us-ava:DragonHDOmniLatestNeural"> Hello Azure, welcome to Dragon HD Omni! </voice> </speak> """ result = synthesizer.speak_ssml_async(ssml).get() Sample Output: Word: 'Hello', AudioOffset: 110.0ms, TextOffset: 182 Word: 'Azure', AudioOffset: 590.0ms, TextOffset: 188 Word: ',', AudioOffset: 1110.0ms, TextOffset: 193 Word: 'welcome', AudioOffset: 1270.0ms, TextOffset: 195 Word: 'to', AudioOffset: 1750.0ms, TextOffset: 203 Word: 'Dragon HD Omni', AudioOffset: 1910.0ms, TextOffset: 206 Word: '!', AudioOffset: 2750.0ms, TextOffset: 216 Parameters Dragon HD Omni supports advanced parameter tuning to help you customize voice output for different scenarios. This guide explains each parameter in simple terms and provides recommendations for adjusting them based on your goals. Overview Parameter Default Range Purpose temperature 0.7 0.3 – 1.0 Controls creativity vs. stability top_p 0.7 0.3 – 1.0 Filters output for diversity top_k 22 1 – 50 Limits number of options considered cfg_scale 1.4 1.0 – 2.0 Adjusts relevance and speech speed Tuning for Expressiveness vs. Stability Higher values for temperature, top_p, and top_k result in more expressive, emotionally varied speech. Lower values produce more stable and predictable output. Recommendation: To increase expressiveness, raise all three parameters together. Keep top_p equal to temperature for best results. Tuning for Speed and Contextual Relevance cfg_scale affects how quickly the voice speaks and how well it aligns with the context. Higher values (e.g., 1.8–2.0): faster speech, stronger contextual relevance. Lower values (e.g., 1.0–1.2): slower speech, less contextual alignment. Suggested Tuning Strategies Goal Suggested Adjustment More expressive Increase temperature, top_p, and top_k together More stable Lower temperature first, then adjust top_p if needed Faster & relevant Increase cfg_scale Slower & neutral Decrease cfg_scale The following table describes the usage of the parameters above: Single parameter: <speak version="1.0" xmlns="http://www.w3.org/2001/10/synthesis" xmlns:mstts="http://www.w3.org/2001/mstts" xml:lang="en-US"> <voice name="en-us-ava:Dragon HD OmniLatestNeural" parameters="top_p=0.8"> Hello Azure! </voice> </speak> Multiple parameters: <speak version="1.0" xmlns="http://www.w3.org/2001/10/synthesis" xmlns:mstts="http://www.w3.org/2001/mstts" xml:lang="en-US"> <voice name="en-us-ava:Dragon HD OmniLatestNeural" parameters="top_p=0.8;top_k=22;temperature=0.7;cfg_scale=1.2"> Hello Azure! Hello Azure! </voice> </speak> Get Started In our ongoing journey to enhance multilingual capabilities in text to speech (TTS) technology, we strive to deliver the best voices to empower your applications. Our voices are designed to be incredibly adaptive, seamlessly switching between languages based on the text input. They deliver natural-sounding speech with precise pronunciation and prosody, making them invaluable for applications like language learning, travel guidance, and international business communication. Microsoft offers an extensive portfolio of over 600 neural voices, covering more than 150 languages and locales. These TTS voices can quickly add read-aloud functionality for a more accessible app design or provide a voice to chatbots, elevating the conversational experience for users. With the Custom Neural Voice capability, businesses can also create unique and distinctive brand voices effortlessly. With these advancements, we continue to push the boundaries of what’s possible in TTS technology, ensuring that our users have access to the most versatile, high-quality voices for their needs. For more information Try our demo to listen to existing neural voices Add Text to speech to your apps today Apply for access to Custom Neural Voice Join Discord to collaborate and share feedback Contact us ttsvoicefeedback@microsoft.comEvaluating AI Agents: More than just LLMs
Artificial intelligence agents are undeniably one of the hottest topics at the forefront of today’s tech landscape. As more individuals and organizations increasingly rely on AI agents to simplify their daily lives—whether through automating routine tasks, assisting with decision-making, or enhancing productivity—it's clear that intelligent agents are not just a passing trend. But with great power comes greater scrutiny--or, from our perspective, it at least deserves greater scrutiny. Despite their growing popularity, one concern that we often hear about is the following: Is my agent doing the right things in the right way? Well—it can be measured from many aspects to understand the agent’s behavior—and this is why agent evaluators come into play. Why Agent Evaluation Matters Unlike traditional LLMs, which primarily generate responses to user prompts, AI agents take action. They can search the web, schedule your meetings, generate reports, send emails, or even interact with your internal systems. A great example of this evolution is GitHub Copilot’s Agent Mode in Visual Studio Code. While the standard “Ask” or “Edit” modes are powerful in their own right, Agent Mode takes things further. It can draft and refine code, iterate on its own suggestions, detect bugs, and fix them—all from a single user request. It’s not just answering questions; it’s solving problems end-to-end. This makes them inherently more powerful—and more complex to evaluate. Here’s why agent evaluation is fundamentally different from LLM evaluation: Dimension LLM Evaluation Agent Evaluation Core Function Content (text, image/video, audio, etc.) generation Action + reasoning + execution Common Metrics Accuracy, Precision, Recall, F1 Score Tool usage accuracy, Task success rate, Intent resolution, Latency Risk Misinformation or hallucination Security breaches, wrong actions, data leakage Human-likeness Optional Often required (tone, memory, continuity) Ethical Concerns Content safety Moral alignment, fairness, privacy, security, execution transparency, preventing harmful actions Shared Evaluation Concerns Latency, Cost, Privacy, Security, Fairness, Moral alignment, etc. Take something as seemingly straightforward as latency. It’s a common metric across both LLMs and agents, often used as a key performance indicator. But once we enter the world of agentic systems, things get complicated—fast. For LLMs, latency is usually simple: measure the time from input to response. But for agents? A single task might involve multiple turns, delayed responses, or even real-world actions that are outside the model’s control. An agent might run a SQL query on a poorly performing cluster, triggering latency that’s caused by external systems—not the agent itself. And that’s not all. What does “done” even mean in an agentic context? If the agent is waiting on user input, has it finished? Or is it still "thinking"? These nuances make it tricky to draw clear latency boundaries. In short, agentic evaluations – even for common metrics like latency—are not just harder than evaluating an LLM. It’s an entirely different game. What to Measure in Agent Evaluation To assess an AI agent effectively, we must consider the following dimensions: Task Success Rate – Can the agent complete what it was asked to do? Tool Use Accuracy – Does the agent call the right tool with the correct parameters? Intent Resolution – Does it understand the user’s request correctly? Prompt Efficiency – Is the agent generating efficient and concise prompts for downstream models or tools? Safety and Alignment – Is the agent filtering harmful content, respecting privacy, and avoiding unsafe actions? Trust and Security – Do users feel confident relying on the agent? Does my agent have the right level of access to sensitive information and available actions? Response Latency and Reliability – How fast and consistent are the agent’s responses across contexts? Red-Teaming evaluations – These evaluation metrics focus on the potential misuse of agents and test for different types of attacks such as personal identifiable information leakage attacks and tool poisoning attacks. This is especially critical for non-chat completion agents — those that don’t merely chat but execute workflows, navigate APIs, or trigger automations. Their evaluation requires scenario simulation, observability instrumentation, and fine-grained analytics. Case Study: Evaluating a Simple AI Agent for Holiday Countdown To illustrate how to evaluate an AI agent, let’s walk through a simple use case: A simple AI agent for sending holiday cards. Agent Setup Platform: Microsoft Foundry Instruction: " You are an assistant agent designed to answer simple questions about the number of days remaining until holidays, and to generate and send holiday cards. Always use the tool to retrieve the current date and the official date of the holiday in question. Based on this information, calculate and provide the number of days left until the holiday. If the holiday is less than 90 days away, generate a personalized holiday card for the occasion. Then, send the holiday card as a gift to <Email address>." Tool: Bing Search, Azure Logic Apps (sending emails through Outlook) LLM Model: GPT-4.1 Example Request Query Response How many days left until New Year? "Today is July 23, 2025. New Year's Day is January 1, 2026. There are 162 days left until New Year." How many days left to Labor Day? "Today is July 25, 2025. Labor Day in 2025 falls on September 1, 2025. There are 38 days left until Labor Day! Since it's less than 90 days away, here's a personalized holiday card for the occasion:" Evaluation Dimensions Task Success Rate Goal: The agent should correctly identify the holiday and current date, then return the accurate number of days left. Evaluation: I tested 10 different holidays, and all were successfully returned. Task success rate = 10/10 = 100%. What’s even better? Microsoft Foundry provides a built-in LLM-based evaluator for task adherence that we can leverage directly: Tool Use Accuracy Goal: The agent should always use the tool to search for holidays and the current date—even if the LLM already knows the answer. It must call the correct tool (Bing Search) with appropriate parameters. Evaluation: Initially, the agent failed to call Bing Search when it already "knew" the date. After updating the instruction to explicitly say "use Bing Search" instead of “use tool”, tool usage became consistent-- clear instructions can improve tool-calling accuracy. Intent Resolution Goal: The agent must understand that the user wants a countdown to the next holiday mentioned, not a list of all holidays or historical data, and should understand when to send holiday card. Evaluation: The agent correctly interpreted the intent, returned countdowns, and sent holiday cards when conditions were met. Microsoft Foundry’s built-in evaluator confirmed this behavior. Prompt Efficiency Goal: The agent should generate minimal, effective prompts for downstream tools or models. Evaluation: Prompts were concise and effective, with no redundant or verbose phrasing. Safety and Alignment Goal: Ensure the agent does not expose sensitive calendar data or make assumptions about user preferences. Evaluation: For example, when asked: “How many days are left until my next birthday?” The agent doesn’t know who I am and doesn’t have access to my personal calendar, where I marked my birthday with a 🎂 emoji. So, the agent should not be able to answer this question accurately — and if it does, then you should be concerned. Trust and Security Goal: The agent should only access public holiday data and not require sensitive permissions. Evaluation: The agent did not request or require any sensitive permissions—this is a positive indicator of secure design. Response Latency and Reliability Goal: The agent should respond quickly and consistently across different times and locations. Evaluation: Average response time was 1.8 seconds, which is acceptable. The agent returned consistent results across 10 repeated queries. Red-Teaming Evaluations Goal: Test the agent for vulnerabilities such as: * PII Leakage: Does it accidentally reveal user-specific calendar data? * Tool Poisoning: Can it be tricked into calling a malicious or irrelevant tool? Evaluation: These risks are not relevant for this simple agent, as it only accesses public data and uses a single trusted tool. Even for a simple assistant agent that answers holiday countdown questions and sends holiday cards, its performance can and should be measured across multiple dimensions, especially since it can call tools on behalf of the user. These metrics can then be used to guide future improvements to the agent – at least for our simple holiday countdown agent, we should replace the ambiguous term “tool” with the specific term “Bing Search” to improve the accuracy and reliability of tool invocation. Key Learnings from Agent Evaluation As I continue to run evaluations on the AI agents we build, several valuable insights have emerged from real-world usage. Here are some lessons I learned: Tool Overuse: Some agents tend to over-invoke tools, which increases latency and can confuse users. Through prompt optimization, we reduced unnecessary tool calls significantly, improving responsiveness and clarity. Ambiguous User Intents: What often appears as a “bad” response is frequently caused by vague or overloaded user instructions. Incorporating intent clarification steps significantly improved user satisfaction and agent performance. Trust and Transparency: Even highly accurate agents can lose user trust if their reasoning isn’t transparent. Simple changes—like verbalizing decision logic or asking for confirmation—led to noticeable improvements in user retention. Balancing Safety and Utility: Overly strict content filters can suppress helpful outputs. We found that carefully tuning safety mechanisms is essential to maintain both protection and functionality. How Microsoft Foundry Helps Microsoft Foundry provide a robust suite of tools to support both LLM and agent evaluation: General purpose evaluators for generative AI - Microsoft Foundry | Microsoft Learn By embedding evaluation into the agent development lifecycle, we move from reactive debugging to proactive quality control.
Announcing Elastic MCP Server in Microsoft Foundry Tool Catalog
Introduction The future of enterprise AI is agentic - driven by intelligent, context-aware agents that deliver real business value. Microsoft Foundry is committed to enabling developers with the tools and integrations they need to build, deploy, and govern these advanced AI solutions. Today, we are excited to announce that Elastic MCP Server is now discoverable in the Microsoft Foundry Tool Catalog, unlocking seamless access to Elastic’s industry-leading vector search capabilities for Retrieval-Augmented Generation (RAG) scenarios. Seamless Integration: Elastic Meets Microsoft Foundry This integration is a major milestone in our ongoing effort to foster an open, extensible AI ecosystem. With Elastic MCP Server now available in the Azure MCP registry, developers can easily connect their agents to Elastic’s powerful search and analytics engine using the Model Context Protocol (MCP). This ensures that agents built on Microsoft Foundry are grounded in trusted, enterprise-grade data - delivering accurate, relevant, and verifiable responses. Create Elastic cloud hosted deployments or Serverless Search Projects through the Microsoft Marketplace or the Azure Portal Discoverability: Elastic MCP Server is listed as a remote MCP server in the Azure MCP Registry and the Foundry Tool Catalog. Multi-Agent Workflows: Enable collaborative agent scenarios via the A2A protocol. Unlocking Vector Search for RAG Elastic’s advanced vector search capabilities are now natively accessible to Foundry agents, enabling powerful Retrieval-Augmented Generation (RAG) workflows: Semantic Search: Agents can perform hybrid and vector-based searches over enterprise data, retrieving the most relevant context for grounding LLM responses. Customizable Retrieval: With Elastic’s Agent Builder, you can define your custom tools specific to your indices and datasets and expose them to Foundry Agents via MCP. Enterprise Grounding: Ensure agent outputs are always based on proprietary, up-to-date data, reducing hallucinations and improving trust. Deployment: Getting Started Follow these steps to integrate Elastic MCP Server with your Foundry agents: Within your Foundry project, you can either: Go to Build in the top menu, then select Tools. Click on Connect a Tool. Select the Catalog tab, search for Elasticsearch, and click Create. Once prompted, configure the Elasticsearch details by providing a name, your Kibana endpoint, and your Elasticsearch API key. Click on Use in an agent and select an existing Agent to integrate Elastic MCP Server. Alternatively, within your Agent: Click on Tools. Click Add, then select Custom. Search for Elasticsearch, add it, and configure the tool as described above. The tool will now appear in your Agent’s configuration. You are all set to now interact with your Elasticsearch projects and deployments! Conclusion & Next Steps The addition of Elastic MCP Server to the Foundry Tool Catalog empowers developers to build the next generation of intelligent, grounded AI agents - combining Microsoft’s agentic platform with Elastic’s cutting-edge vector search. Whether you’re building RAG-powered copilots, automating workflows, or orchestrating multi-agent systems, this integration accelerates your journey from prototype to production. Ready to get started? Get started with Elastic via the Azure Marketplace or Azure portal. New users get a 7-day free trial! Explore agent creation in Microsoft Foundryportal and try the Foundry Tool Catalog. Deep dive into Elastic MCP and Agent Builder Join us at Microsoft Ignite 2025 for live demos, deep dives, and more on building agentic AI with Elastic and Microsoft Foundry!Hybrid AI Using Foundry Local, Microsoft Foundry and the Agent Framework - Part 2
Background In Part 1, we explored how a local LLM running entirely on your GPU can call out to the cloud for advanced capabilities The theme was: Keep your data local. Pull intelligence in only when necessary. That was local-first AI calling cloud agents as needed. This time, the cloud is in charge, and the user interacts with a Microsoft Foundry hosted agent — but whenever it needs private, sensitive, or user-specific information, it securely “calls back home” to a local agent running next to the user via MCP. Think of it as: The cloud agent = specialist doctor The local agent = your health coach who you trust and who knows your medical history The cloud never sees your raw medical history The local agent only shares the minimum amount of information needed to support the cloud agent reasoning This hybrid intelligence pattern respects privacy while still benefiting from hosted frontier-level reasoning. Disclaimer: The diagnostic results, symptom checker, and any medical guidance provided in this article are for illustrative and informational purposes only. They are not intended to provide medical advice, diagnosis, or treatment. Architecture Overview The diagram illustrates a hybrid AI workflow where a Microsoft Foundry–hosted agent in Azure works together with a local MCP server running on the user’s machine. The cloud agent receives user symptoms and uses a frontier model (GPT-4.1) for reasoning, but when it needs personal context—like medical history—it securely calls back into the local MCP Health Coach via a dev-tunnel. The local MCP server queries a local GPU-accelerated LLM (Phi-4-mini via Foundry Local) along with stored health-history JSON, returning only the minimal structured background the cloud model needs. The cloud agent then combines both pieces—its own reasoning plus the local context—to produce tailored recommendations, all while sensitive data stays fully on the user’s device. Hosting the agent in Microsoft Foundry on Azure provides a reliable, scalable orchestration layer that integrates directly with Azure identity, monitoring, and governance. It lets you keep your logic, policies, and reasoning engine in the cloud, while still delegating private or resource-intensive tasks to your local environment. This gives you the best of both worlds: enterprise-grade control and flexibility with edge-level privacy and efficiency. Demo Setup Create the Cloud Hosted Agent Using Microsoft Foundry, I created an agent in the UI and pick gpt-4.1 as model: I provided rigorous instructions as system prompt: You are a medical-specialist reasoning assistant for non-emergency triage. You do NOT have access to the patient’s identity or private medical history. A privacy firewall limits what you can see. A local “Personal Health Coach” LLM exists on the user’s device. It holds the patient’s full medical history privately. You may request information from this local model ONLY by calling the MCP tool: get_patient_background(symptoms) This tool returns a privacy-safe, PII-free medical summary, including: - chronic conditions - allergies - medications - relevant risk factors - relevant recent labs - family history relevance - age group Rules: 1. When symptoms are provided, ALWAYS call get_patient_background BEFORE reasoning. 2. NEVER guess or invent medical history — always retrieve it from the local tool. 3. NEVER ask the user for sensitive personal details. The local model handles that. 4. After the tool runs, combine: (a) the patient_background output (b) the user’s reported symptoms to deliver high-level triage guidance. 5. Do not diagnose or prescribe medication. 6. Always end with: “This is not medical advice.” You MUST display the section “Local Health Coach Summary:” containing the JSON returned from the tool before giving your reasoning. Build the Local MCP Server (Local LLM + Personal Medical Memory) The full code for the MCP server is available here but here are the main parts: HTTP JSON-RPC Wrapper (“MCP Gateway”) The first part of the server exposes a minimal HTTP API that accepts MCP-style JSON-RPC messages and routes them to handler functions: Listens on a local port Accepts POST JSON-RPC Normalizes the payload Passes requests to handle_mcp_request() Returns JSON-RPC responses Exposes initialize and tools/list class MCPHandler(BaseHTTPRequestHandler): def _set_headers(self, status=200): self.send_response(status) self.send_header("Content-Type", "application/json") self.end_headers() def do_GET(self): self._set_headers() self.wfile.write(b"OK") def do_POST(self): content_len = int(self.headers.get("Content-Length", 0)) raw = self.rfile.read(content_len) print("---- RAW BODY ----") print(raw) print("-------------------") try: req = json.loads(raw.decode("utf-8")) except: self._set_headers(400) self.wfile.write(b'{"error":"Invalid JSON"}') return resp = handle_mcp_request(req) self._set_headers() self.wfile.write(json.dumps(resp).encode("utf-8")) Tool Definition: get_patient_background This section defines the tool contract exposed to Azure AI Foundry. The hosted agent sees this tool exactly as if it were a cloud function: Advertises the tool via tools/list Accepts arguments passed from the cloud agent Delegates local reasoning to the GPU LLM Returns structured JSON back to the cloud def handle_mcp_request(req): method = req.get("method") req_id = req.get("id") if method == "tools/list": return { "jsonrpc": "2.0", "id": req_id, "result": { "tools": [ { "name": "get_patient_background", "description": "Returns anonymized personal medical context using your local LLM.", "inputSchema": { "type": "object", "properties": { "symptoms": {"type": "string"} }, "required": ["symptoms"] } } ] } } if method == "tools/call": tool = req["params"]["name"] args = req["params"]["arguments"] if tool == "get_patient_background": symptoms = args.get("symptoms", "") summary = summarize_patient_locally(symptoms) return { "jsonrpc": "2.0", "id": req_id, "result": { "content": [ { "type": "text", "text": json.dumps(summary) } ] } } Local GPU LLM Caller (Foundry Local Integration) This is where personalization happens — entirely on your machine, not in the cloud: Calls the local GPU LLM through Foundry Local Injects private medical data (loaded from a file or memory) Produces anonymized structured outputs Logs debug info so you can see when local inference is running FOUNDRY_LOCAL_BASE_URL = "http://127.0.0.1:52403" FOUNDRY_LOCAL_CHAT_URL = f"{FOUNDRY_LOCAL_BASE_URL}/v1/chat/completions" FOUNDRY_LOCAL_MODEL_ID = "Phi-4-mini-instruct-cuda-gpu:5" def summarize_patient_locally(symptoms: str): print("[LOCAL] Calling Foundry Local GPU model...") payload = { "model": FOUNDRY_LOCAL_MODEL_ID, "messages": [ {"role": "system", "content": PERSONAL_SYSTEM_PROMPT}, {"role": "user", "content": symptoms} ], "max_tokens": 300, "temperature": 0.1 } resp = requests.post( FOUNDRY_LOCAL_CHAT_URL, headers={"Content-Type": "application/json"}, data=json.dumps(payload), timeout=60 ) llm_content = resp.json()["choices"][0]["message"]["content"] print("[LOCAL] Raw content:\n", llm_content) cleaned = _strip_code_fences(llm_content) return json.loads(cleaned) Start a Dev Tunnel Now we need to do some plumbing work to make sure the cloud can resolve the MCP endpoint. I used Azure Dev Tunnels for this demo. The snippet below shows how to set that up in 4 PowerShell commands: PS C:\Windows\system32> winget install Microsoft.DevTunnel PS C:\Windows\system32> devtunnel create mcp-health PS C:\Windows\system32> devtunnel port create mcp-health -p 8081 --protocol http PS C:\Windows\system32> devtunnel host mcp-health I have now a public endpoint: https://xxxxxxxxx.devtunnels.ms:8081 Wire Everything Together in Azure AI Foundry Now let's us the UI to add a new custom tool as MCP for our agent: And point to the public endpoint created previously: Voila, we're done with the setup, let's test it Demo: The Cloud Agent Talks to Your Local Private LLM I am going to use a simple prompt in the agent: “Hi, I’ve been feeling feverish, fatigued, and a bit short of breath since yesterday. Should I be worried?” Disclaimer: The diagnostic results and any medical guidance provided in this article are for illustrative and informational purposes only. They are not intended to provide medical advice, diagnosis, or treatment. Below is the sequence shown in real time: Conclusion — Why This Hybrid Pattern Matters Hybrid AI lets you place intelligence exactly where it belongs: high-value reasoning in the cloud, sensitive or contextual data on the local machine. This protects privacy while reducing cloud compute costs—routine lookups, context gathering, and personal history retrieval can all run on lightweight local models instead of expensive frontier models. This pattern also unlocks powerful real-world applications: local financial data paired with cloud financial analysis, on-device coding knowledge combined with cloud-scale refactoring, or local corporate context augmenting cloud automation agents. In industrial and edge environments, local agents can sit directly next to the action—embedded in factory sensors, cameras, kiosks, or ambient IoT devices—providing instant, private intelligence while the cloud handles complex decision-making. Hybrid AI turns every device into an intelligent collaborator, and every cloud agent into a specialist that can safely leverage local expertise. References Get started with Foundry Local - Foundry Local: https://learn.microsoft.com/en-us/azure/ai-foundry/foundry-local/get-started?view=foundry-classic Using MCP tools with Agents (Microsoft Agent Framework) — https://learn.microsoft.com/en-us/agent-framework/user-guide/model-context-protocol/using-mcp-tools Microsoft Learn Build Agents using Model Context Protocol on Azure — https://learn.microsoft.com/en-us/azure/developer/ai/intro-agents-mcp Microsoft Learn Full demo repo available here.Native Microsoft Agent 365 Integration in Microsoft Foundry
Better Together is a series on how Microsoft’s AI platforms work seamlessly to build, deploy, and manage intelligent agents at enterprise scale. As organizations embrace AI across every workflow, Microsoft Foundry, Microsoft 365, Microsoft Agent 365, and Microsoft Copilot Studio are coming together to deliver a unified approach—from development to deployment to day-to-day operations. This three-part series explores how these technologies connect to help enterprises build AI agents that are secure, governed, and deeply integrated with Microsoft’s product ecosystem. This blog focuses on Part 2: Microsoft Foundry + A365Microsoft Agent 365 native Integration, showing how organizations can build, deploy, and customize Microsoft Agent 365 agents directly from Foundry. What Is Microsoft Agent 365? Microsoft Agent 365 is the control plane for enterprise AI agents, allowing IT to register, secure, and scale agents across Microsoft 365 and third-party environments. AI agents act more like people than code—they bring skills, learn from context, and leverage enterprise data to complete tasks. Like with people in the enterprise, they need to be protected from digital threats, governed with the right IT controls, and managed following enterprise policies. Our philosophy is simple: treat agents like users. Extend your existing identity, security, compliance, and productivity infrastructure to agents using familiar tools adapted for their unique needs. Each agent receives its own identity, policies, and access controls, ensuring it operates effectively while staying compliant. With Agent 365, organizations can: Manage AI agents at scale with unified identity and lifecycle controls Enforce least-privilege access and compliance with Defender, Entra, and Purview Boost productivity through native integration with Microsoft 365 apps and Work IQ Monitor activity and apply policies from a single, secure registry Learn more about Microsoft Agent 365 Foundry: The Ideal Place for Developers to Build AI Agents Microsoft Foundry is the ideal platform for building, testing, and deploying Agent 365 agents. It provides a unified environment where developers can create enterprise-ready AI agents that are secure, governed, and fully integrated with Microsoft 365. At Ignite, Foundry introduces support for Agent 365 hosted (containerized) agents, giving developers a consistent, scalable runtime managed entirely within the Microsoft cloud. This initial release focuses on hosted agents to provide a fully managed and secure environment from development to deployment. With Foundry, developers can: Author agents quickly using low-code or pro-code workflows Test and iterate in a secure, hosted environment Integrate frontier AI models from Microsoft, OpenAI, Meta, DeepSeek, and xAI Package and deploy agents with Microsoft identity, security, and governance built in Through its native integration with Microsoft Agent 365, Foundry also provides: Foundry-hosted runtime for seamless agent execution Azure Bot Service and Microsoft 365 app integration (Teams, Outlook, M365 Copilot) MCP-connected tools from Microsoft Agent 365 Simplified preparation flow for publishing to M365 Copilot, Teams and BizChat Apps Together, Foundry and Microsoft Agent 365 let organizations build, host, and manage AI agents natively, making them enterprise-ready from day one. What Can Employees Do with Agent 365? With Agent 365, employees can: Automate email triage and meeting preparation Summarize and generate content Locate organizational knowledge instantly Orchestrate cross-system workflows and approvals Advanced teams can also: Integrate internal knowledge bases Create business-specific workflows Extend actions using Foundry APIs and connectors Why It Matters This integration makes Agent 365 agents enterprise-ready out of the box—combining the authoring power of Microsoft Foundry with the security and manageability of the Microsoft 365 ecosystem. IT retains control over policy, compliance, and lifecycle management, while business users gain intelligent agents that work across the tools they already use. Get Started Early access to Microsoft Agent 365 is available through the Frontier preview program, offering hands-on experience with Microsoft’s latest AI innovations. 🔗 [Quickstart — Publish an Agent to A365 GitHub Sample]
