Since 2019, Microsoft and OpenAI have worked together with a shared goal of advancing artificial intelligence in a responsible and accessible way. What started as Microsoft’s investment in a research-focused organization has evolved into one of the industry’s most impactful collaborations. Now, as we move into a new chapter of this partnership, both companies have signed a new definitive agreement that reinforces our strong foundation, deepens our collaboration, and paves the way for continued long-term growth and innovation.
To begin with, Microsoft is fully backing OpenAI’s decision to establish a public benefit corporation (PBC) and undergo a recapitalization process. After this restructuring, Microsoft’s investment in OpenAI Group PBC is valued at around $135 billion, accounting for roughly 27% ownership on an as-converted, diluted basis this includes all shareholders such as employees, investors, and the OpenAI Foundation. Prior to the most recent funding rounds, Microsoft’s stake in OpenAI’s for-profit entity stood at approximately 32.5% on an as-converted basis.
The new agreement maintains the core aspects that have made the Microsoft–OpenAI collaboration so effective. OpenAI will continue to serve as Microsoft’s primary partner for frontier AI models, while Microsoft retains its exclusive rights to OpenAI’s intellectual property and Azure API until the development of Artificial General Intelligence (AGI).
In addition, the agreement introduces updated and expanded terms that allow both organizations to independently pursue innovation and future growth while continuing to strengthen their partnership.
Key Updates in the Partnership
- Independent AGI Verification:**
When OpenAI announces the achievement of AGI, that milestone will be confirmed by an independent panel of experts to ensure transparency and accountability. - Extended IP Rights:
Microsoft’s intellectual property rights covering OpenAI’s models and products are now valid through 2032. These rights also extend to post-AGI models, with built-in safety measures in place. - Research IP Duration and Scope:
Microsoft’s access to OpenAI’s research-related IP—defined as confidential techniques used in developing AI systems—will continue until either AGI is verified by the expert panel or until 2030, whichever comes first. This research IP includes internal-use models but does not cover architecture, weights, inference or finetuning code, or infrastructure-related IP, which remain under Microsoft’s ownership. - Exclusion of Consumer Hardware:
Microsoft’s IP rights no longer apply to OpenAI’s consumer hardware products. - Third-Party Collaboration Flexibility:
OpenAI may now co-develop products with external partners. API-based offerings made with these partners will remain exclusive to Azure, while non-API products can run on other cloud platforms. - Independent AGI Development by Microsoft:
Microsoft is now free to develop AGI independently or in partnership with other organizations. - Compute Thresholds for Pre-AGI Models:
Any AGI work by Microsoft using OpenAI’s IP before AGI is declared will follow defined compute limits—significantly higher than those used for today’s leading AI systems. - Updated Revenue Sharing:
The revenue-sharing framework stays in place until AGI verification, though payments will now be distributed over a longer timeline. - Azure Service Expansion:
OpenAI has agreed to purchase an additional $250 billion in Azure services. Microsoft will no longer hold exclusive first-refusal rights as OpenAI’s compute provider. - Government Access Flexibility:
OpenAI can now offer API services to U.S. national security agencies, regardless of the underlying cloud platform. - Open-Weight Model Release:
OpenAI now has the ability to publish open-weight models that meet established capability and safety standards.
As we move forward into this new phase of collaboration, Microsoft and OpenAI are more aligned and equipped than ever to develop impactful technologies that address real-world challenges. Together, we aim to drive innovation that empowers individuals, supports businesses, and expands opportunities across industries worldwide.
