Microsoft and OpenAI announced a major restructuring of their partnership, ending Microsoft's exclusive partner status. This change grants OpenAI greater flexibility in revenue structure and customer service, allowing the ChatGPT developer to set a revenue share cap for Microsoft and serve customers through any cloud provider, not limited to Microsoft anymore.
Under the new agreement, the two companies stated OpenAI will supply models to Microsoft until 2032, and revenue sharing from OpenAI to Microsoft will be subject to a total cap, continuing through 2030. This arrangement will no longer depend on OpenAI's technological progress, meaning Microsoft may no longer impose conditions on the development of Artificial General Intelligence (AGI) after this point.
Regarding revenue structure, the revenue-sharing agreement has been ongoing for years. It was revealed that OpenAI will continue paying Microsoft the same 20% share under the new deal, meaning Microsoft will still receive revenue from every ChatGPT subscription user.
Previously, when users paid to access OpenAI's models via the Azure platform, Microsoft paid OpenAI. However, under the new agreement announced in a blog post on Monday, 27 April, Microsoft will no longer pay revenue shares back to OpenAI.
OpenAI stated, “Today we announce an updated agreement to simplify our collaboration and working model, based on principles of flexibility, clarity, and focusing on delivering AI benefits broadly to users.”
Additionally, this move opens the door for OpenAI to restructure as a company, paving the way for a potential IPO in the future.
Under the new agreement, Microsoft remains OpenAI's primary cloud provider, and OpenAI's products will continue to launch first on Azure unless Microsoft decides otherwise. OpenAI can also offer its products on other cloud platforms, including Amazon or Google, which had previously announced deals with OpenAI.
In February, Amazon and OpenAI announced a major strategic partnership, with Amazon agreeing to invest up to $50 billion in OpenAI. OpenAI also plans to expand its existing AWS agreement from $38 billion to $100 billion over eight years. AWS will serve as the exclusive external cloud provider for OpenAI’s newly launched Frontier enterprise platform.
Related news:
Previously, Denise Dresser, OpenAI’s Chief Revenue Officer, stated in an internal memo that “the previous partnership limited our ability to reach enterprise customers as they needed.”
Microsoft has been a major supporter of OpenAI since 2019, investing over $13 billion. Although both parties emphasize the strategic importance of their partnership, recent signs of tension have emerged as both companies expand into each other’s business areas.
Regarding intellectual property rights, Microsoft will retain rights to use OpenAI's AI model technology until 2032, but these rights will no longer be exclusive.
After announcing the new collaboration structure, Microsoft’s shares fell about 5%. Bloomberg previously reported that Microsoft’s performance this quarter could be its worst since the 2008 financial crisis. In the first quarter of this year, Microsoft shares had already dropped by 25%, lagging behind other major tech companies in the Mag 7 group.
Source:CNBC,Bloomberg,Yahoo! Finance
Follow the Facebook page: Thairath Money at this link -https://www.facebook.com/ThairathMoney