Official announcements from Microsoft or OpenAI, or major financial news outlets

Microsoft and OpenAI Revise $13B Partnership Terms, Set $100B AGI Benchmark

Dec 26, 2024, 03:35 PM

Microsoft Corp., with a valuation of $3 trillion, and OpenAI have been engaged in discussions to potentially revise their $13 billion-plus partnership terms since October. The negotiations focus on several key areas: Microsoft's equity stake in OpenAI's for-profit entity, the exclusivity of Microsoft as OpenAI's cloud provider, the usage rights of OpenAI's intellectual property, and the continuation of Microsoft's 20% revenue share from OpenAI. These talks reflect underlying tensions, particularly concerning the cloud computing deal. Microsoft has expressed concerns about the cost and speed of OpenAI's models, such as GPT-4, which are deemed too slow and expensive for enterprise needs. Additionally, the partnership has been strained by disagreements over the definition and financial benchmarks of Artificial General Intelligence (AGI), with both companies setting a contractual goal of $100 billion in profits to signify AGI achievement.