Microsoft loses exclusive Access over OpenAI

Microsoft will no longer have exclusive access to OpenAI’s models and products under a revised partnership, allowing the startup to expand its technology across competing cloud platforms.

OpenAI can now license its technology to other providers, including rivals such as Amazon and Google.

Microsoft will retain a non-exclusive license to OpenAI’s intellectual property through 2032. It will also remain OpenAI’s primary cloud partner, with OpenAI products expected to launch first on Microsoft Azure unless the company cannot support specific requirements.

The changes also change the financial terms between the companies. Microsoft will no longer make revenue-sharing payments to OpenAI. However, OpenAI will continue paying Microsoft a share of its revenue through 2030, subject to a capped total amount.

The updated structure removes previous constraints and gives OpenAI greater flexibility to pursue new commercial partnerships. The companies added that they will continue to collaborate on areas such as data centre capacity, custom silicon and AI applications, including cybersecurity.

OpenAI’s ability to deploy its models across multiple platforms could broaden its reach and reduce dependence on a single partner.

Microsoft, which invested early in OpenAI and integrated its models into products such as Azure and Windows tools, remains a major shareholder in the startup. The company’s access to OpenAI technology helped position it as a leading player in the AI race.

Still, investors reacted cautiously to the change. Shares of Microsoft fell nearly 3% in extended trading following the announcement, while shares of Alphabet and Amazon edged higher.