Microsoft and OpenAI agree on new partnership rules

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Microsoft and OpenAI have fundamentally restructured their partnership, which has existed since 2019, and redefined their self-imposed rules for joint AI development. OpenAI expects Microsoft's stake in the company to be valued at around 135 billion US dollars after the restructuring. This would correspond to a share of approximately 27 percent, including all shareholders such as employees, investors, and the OpenAI Foundation.

Restructuring Long Planned

The redesign of the partnership comes as no surprise: As early as May 2025, the two companies were negotiating about the future collaboration, after the relationship had noticeably cooled. OpenAI is striving for more independence, while Microsoft increasingly feels snubbed by the growing self-confidence of its partner.

Nevertheless, the new agreement maintains central elements of the previous cooperation: OpenAI remains Microsoft's partner for frontier models, and Microsoft retains exclusive rights to intellectual property as well as exclusivity for Azure APIs – but only until artificial general intelligence (AGI) is achieved.

At the same time, both companies will gain significantly more scope for independent developments. Microsoft can work on AGI systems independently or with third parties in the future. However, if the corporation uses OpenAI technology in the process, compute thresholds will apply that are significantly above the current training capacities for leading models. OpenAI, in turn, is now allowed to develop products together with third parties – although API products must continue to run exclusively via Azure, while non-API products may be provided on any cloud provider.

Independent Panel to Determine AGI Achievement

A central innovation concerns the definition and determination of AGI. If OpenAI declares in the future that it has achieved AGI, an independent expert panel must verify this. Previously, the AGI definition between the two companies was tied to a revenue mark of 100 billion dollars – an approach that prioritized financial rather than technical criteria.

Microsoft's intellectual property rights have been extended until 2032 and now also cover models after AGI is achieved, albeit with appropriate security measures. The rights to research IP, defined as confidential methods for developing models and systems, remain in place until either the expert panel verifies AGI or until 2030, whichever comes first. However, model architectures, model weights, inference and finetuning code, as well as IP related to data center hardware and software, are excluded from these research rights.

Furthermore, Microsoft's IP rights now explicitly exclude OpenAI's consumer hardware; the AI company is already planning its own devices. In addition, OpenAI can now provide API access for US government customers in the national security sector, regardless of the cloud provider used. OpenAI is also now permitted to publish open-weight models, provided they meet certain capability criteria.

Massive Azure Commitment Without Right of First Refusal

In financial terms, OpenAI has committed to purchasing an additional 250 billion US dollars worth of Azure services – a clear commitment to Microsoft's cloud platform. At the same time, however, Microsoft loses its previous right of first refusal as a preferred compute provider. The existing revenue sharing agreement remains in place until AGI verification, with payments being spread over a longer period.

The restructuring enables OpenAI to complete the planned step towards becoming a Public Benefit Corporation – a corporate form that can pursue both non-profit and for-profit goals. The non-profit board retains significant influence and will become a major shareholder.

All information about the redesigned partnership can be found in a statement from OpenAI.

(fo)