OpenAI ends Microsoft exclusivity

OpenAI and Microsoft rewrote their partnership on April 27, ending Microsoft’s exclusive rights to OpenAI technology and opening OpenAI products to other clouds. (openai.com) (blogs.microsoft.com) The new terms keep Microsoft as OpenAI’s primary cloud partner, and OpenAI products will still ship first on Azure unless Microsoft cannot support the needed capabilities. OpenAI said it can now serve all of its products to customers across any cloud provider. (openai.com) (blogs.microsoft.com) Microsoft will keep a license to OpenAI’s intellectual property through 2032, but that license is now non-exclusive. Microsoft also said it will no longer pay a revenue share to OpenAI. (blogs.microsoft.com) (cnbc.com) OpenAI, instead, will continue making revenue-share payments to Microsoft through 2030 at the same percentage as before, but with a total cap. Microsoft said those payments no longer depend on whether OpenAI reaches artificial general intelligence, or AGI. (blogs.microsoft.com) (finance.yahoo.com) That removes one of the most unusual clauses in the old deal. Reuters reported the earlier structure had given OpenAI a path to stop paying Microsoft after an AGI milestone, a trigger that had become harder to define as the companies expanded commercially. (cnbc.com) (cnbctv18.com) The rewrite also loosens Azure’s grip on OpenAI distribution at a moment when OpenAI is chasing more enterprise customers. CNBC reported OpenAI revenue chief Denise Dresser told staff this month that the Microsoft arrangement had "limited our ability to meet enterprises where they are." (cnbc.com) Microsoft has invested more than $13 billion in OpenAI since 2019, and it remains a major shareholder even after giving up exclusivity. OpenAI and Microsoft both described the amendment as a way to add "flexibility" and "long-term clarity" to a partnership that stays in place. (cnbc.com) (openai.com) Reuters reported the new structure clears the way for OpenAI to pursue cloud deals with rivals including Amazon, and potentially Google, while Microsoft keeps preferred access to launches on Azure. Barclays analysts told Reuters the change could also free Microsoft capital and cloud capacity for its own Copilot products. (energynow.com) The companies are still tied together, but the relationship now looks less like a single-cloud lockup and more like a long contract with escape hatches. Azure stays first; exclusivity is gone. (openai.com) (blogs.microsoft.com)