OpenAI, Microsoft Reach Tentative Deal Revising Partnership Structure

OpenAI and Microsoft have reached a tentative deal to restructure their partnership, facilitating OpenAI's transition from a nonprofit to a public benefit corporation, which could eventually allow it to raise capital publicly. Microsoft, having invested over $13 billion for a significant share of OpenAI's future profits, continues to negotiate terms including server rental costs and its stake in the reorganized company. OpenAI's nonprofit arm is projected to receive more than $100 billion, making it one of the world's most well-funded philanthropic entities, while OpenAI aims to reduce the revenue share it gives to commercial partners like Microsoft from 20% to about 8% by the decade's end. The companies are still finalizing the details, with regulatory approvals needed by the end of the year to maintain financing. This restructuring represents a major shift in their longstanding collaboration, which originally granted Microsoft exclusive rights to sell OpenAI products through its Azure platform, though OpenAI has since diversified its partnerships and infrastructure. Both companies emphasize the importance of this realignment for the future development and commercialization of artificial intelligence technologies.