Microsoft and OpenAI loosen ties as revenue share ends and exclusivity falls

Microsoft to Stop Sharing Revenue With Main AI Partner OpenAI

Microsoft Corp. and OpenAI have agreed to drop the software giant's exclusive right to sell the startup's AI models, opening the door for the ChatGPT maker to pursue deals with cloud-computing rivals like Amazon.com Inc. In exchange for ending that exclusivity -- which helped boost Microsoft's cloud sales in the early years of the AI boom -- the world's largest software maker will no longer pay a revenue share on OpenAI products it resells on its cloud. The two companies announced the revised deal in a joint statement on Monday. The new pact is meant to simplify a complicated relationship that has been foundational to OpenAI's rise and the broader artificial intelligence boom. OpenAI has since pursued deals with multiple cloud providers, including Amazon, to meet its growing computing needs to build and service AI software to a wider audience. "The greater predictability in the amended agreement strengthens our joint ability to build and operate AI platforms at scale while providing both companies the flexibility to pursue new opportunities," OpenAI and Microsoft said in their statement. Monday's agreement clears the way to OpenAI's models appearing on Amazon Web Services and other cloud-computing providers. As part of an investment announced earlier this year, the Amazon unit said it was jointly developing products with OpenAI that would be hosted on AWS. Microsoft weighed legal action, on the view that the effort would almost certainly breach its exclusive rights to OpenAI's intellectual property, the Financial Times reported last month. Microsoft remains OpenAI's "primary cloud provider," and new products from the startup will be made available first on Azure, Microsoft's cloud unit. Revenue share paid by OpenAI on sales of its products that it makes itself will be capped, the companies said. As part of OpenAI's restructuring last year as a for-profit business, Microsoft received a 27% ownership stake in the AI startup. Microsoft shares were down about 1% as the markets opened in New York on Monday. Amazon fell less than 1%.

Microsoft will no longer have exclusive access to OpenAI's technology

April 27 (Reuters) - Microsoft (MSFT.O), opens new tab will no longer have exclusive access to OpenAI's artificial intelligence models and products, a significant change that would allow the startup to sell its technology across rival cloud ⁠platforms including Amazon (AMZN.O), opens new tab and Google (GOOGL.O), opens new tab. Shares of Microsoft tumbled nearly 3% after the announcement on Monday, while Alphabet and Amazon gained slightly. Under the reworked partnership, Microsoft will remain OpenAI's primary cloud ⁠partner and have a license to OpenAI intellectual property through 2032. The Windows maker has emerged as ⁠a major player in the artificial intelligence race in recent years thanks ⁠to its early bet and access to technology from ⁠the ChatGPT creator. Reporting by Aditya Soni and Akash Sriram in Bengaluru; Editing by Mrigank Dhaniwala Our Standards: The Thomson Reuters Trust Principles., opens new tab

OpenAI and Microsoft loosen ties in revised AI deal

Microsoft and OpenAI have loosened the terms of their landmark partnership, signalling growing distance in a relationship that has underpinned the AI boom. Under revised measures announced on Monday, OpenAI will be free to sell its technology more widely, while Microsoft will lose exclusive access to its models. The changes further unwind key elements of the alliance between the two companies, removing revenue-sharing obligations for Microsoft but giving OpenAI more flexibility to strike deals with other cloud computing providers. The new terms underscore the growing separation between the fast-growing start-up and its longstanding partner, clearing a path for OpenAI to increase revenues, justify its $852bn valuation and set its sights on a blockbuster IPO. Under the revised deal, Microsoft will keep its $135bn stake, making it the company's largest shareholder. OpenAI will continue to pay Microsoft a revenue share on its products and services until 2030, now subject to a cap. The company did not give specifics on the cap, but one person familiar said it was likely to be an annual arrangement. After 2032, the software giant will retain a non-exclusive licence to OpenAI's models, while OpenAI will no longer get a revenue share from its products being sold by Microsoft. A contentious measure between the companies called the "AGI Clause" has been scrapped. The clause would cut off Microsoft from OpenAI's technology if the start-up created a system that reached artificial general intelligence -- defined as a "highly autonomous system that outperforms humans at most economically valuable work". "The rapid pace of innovation requires us to continue to evolve our partnership to benefit our customers and both companies," Microsoft said, adding the "amended agreement" would simplify the partnership. "The greater predictability in the amended agreement strengthens our joint ability to build and operate AI platforms at scale while providing both companies the flexibility to pursue new opportunities," it added. OpenAI said it had "established a wind-down process to no longer transfer frontier research IP other than what is necessary for Microsoft to commercialise". Since investing an initial $1bn in OpenAI in 2019, Microsoft has been the company's exclusive cloud provider and has sold its products through its Azure platform to enterprises. Under the new arrangement, OpenAI can deliver its products through any cloud provider, but they must be served on Azure first. This clarification is likely to allow OpenAI to proceed with its $50bn arrangement with Amazon and to offer its agentic product, Frontier, to be offered through Amazon Web Services. The FT previously reported that Microsoft was weighing legal action for a potential breach of contract related to OpenAI's deal with Amazon. "This keeps the partnership, but removes the bottlenecks," said OpenAI. "Microsoft remains deeply aligned as a major shareholder and infrastructure partner, while OpenAI now has the independence to build and scale globally on our own terms." The deal comes as a trial opens on Monday over Elon Musk's claims related to OpenAI's transition from a non-profit into a for-profit entity. OpenAI is accused of deceiving Musk into giving a charitable contribution, while Microsoft is accused of "aiding and abetting" the breach of trust. A legal defeat would jeopardise their multibillion-dollar partnership.

Microsoft cuts OpenAI revenue share in a fresh step to loosen their AI alliance

SAN FRANCISCO (AP) -- Microsoft said Monday it will no longer pay a share of its revenue to ChatGPT maker OpenAI, the latest move to untether a close partnership that helped unleash an artificial intelligence boom. OpenAI relied exclusively on Microsoft's investments in cloud computing services to build the technology that helped make ChatGPT a household name. Microsoft, in turn, relied on OpenAI's technology to build its own AI assistant Copilot. But the partnership has evolved as San Francisco-based OpenAI, founded as a nonprofit, has shifted to a capitalistic enterprise on a path toward an initial public offering on Wall Street and has balanced its reliance on Microsoft with other cloud partners like Amazon, Google and Oracle. OpenAI said Monday it will continue to pay Microsoft a share of its revenue through 2030. The two companies said Microsoft remains the primary cloud computing partner for OpenAI, and products made by the AI company will ship first on Microsoft's cloud platform, called Azure, "unless Microsoft cannot and chooses not to support the necessary capabilities." Wedbush Securities analyst Dan Ives said in a note to investors Monday that the new agreement "puts OpenAI on a strong path forward to going public through IPO given its clearer opportunity in the cloud environment while reducing significant barriers from its original partnership with Microsoft." Ives said it's also important for Microsoft as it "looks to develop tech independence from OpenAI" in advancing Copilot's capabilities and partnering with other AI providers such as OpenAI rival Anthropic, maker of the chatbot Claude.

OpenAI breaks out of exclusivity agreements in its partnership with Microsoft

OpenAI is opening up its partnership with Microsoft in the latest amendment to the major multi-year collaboration between the tech giants. The latest changes allow OpenAI to offer its latest AI models to other companies and through other cloud providers, stripping Microsoft of its exclusivity rights. In a joint announcement posted on OpenAI and Microsoft's websites, Microsoft will still be OpenAI's primary cloud partner with the latest products shipping first on Azure, but OpenAI is now allowed to use any cloud provider. Sam Altman, OpenAI's CEO, posted on X that the company is "now able to make our products and services available across all clouds." On top of that, Microsoft will still have a license for OpenAI's models and products through to 2032, but the license will no longer be exclusive. On the business side, Microsoft will no longer pay a revenue share to OpenAI, but OpenAI would still make revenue share payments to Microsoft until 2030, which will now be subject to a total cap. The two companies have worked closely together since announcing a multiyear partnership in 2019. Microsoft and OpenAI have gone through several phases for its collaboration, but the two put out a joint statement in February of this year that still mentioned the exclusivity agreements. However, the latest update confirms that OpenAI can break exclusivity, with the companies arguing these changes are for "flexibility, certainty, and a focus on delivering the benefits of AI broadly."

Microsoft and OpenAI Loosen Their Partnership

Cade Metz reported from San Francisco, and Karen Weise from Seattle. Microsoft and OpenAI have amended their partnership to reduce their dependence on each other amid an escalating global artificial intelligence race, the companies said on Monday. Microsoft, which is OpenAI's biggest financial partner, will continue to license OpenAI's A.I. technology through 2032. But the tech giant, whose stake in OpenAI is valued at more than $135 billion, will no longer be the exclusive licensee of the start-up's A.I. technologies. OpenAI will also no longer receive a share of revenue from Microsoft when the tech giant uses the start-up's technologies. OpenAI will continue to pay a share of revenue to Microsoft when the tech giant serves OpenAI's technologies to businesses and consumers via Microsoft's cloud computing services. But OpenAI has more flexibility to work with other cloud computing providers, the two companies said. OpenAI will release its technology on Microsoft's cloud services first, the companies said, unless "Microsoft cannot and chooses not to support the necessary capabilities." The start-up then has the right to release products on other cloud services. The new agreement also removes complex language that could have changed the two companies' partnership if OpenAI declared that it had reached artificial general intelligence, or A.G.I. That level of technology would mean, in theory, that the technology is as capable as a human brain. The so-called A.G.I. clause added uncertainty for Microsoft. On Monday, jury selection is set to begin in a blockbuster trial that cuts to the heart of the relationship with OpenAI and Microsoft. Elon Musk, an early funder of OpenAI when it was a nonprofit, has sued the start-up and Microsoft in federal court, saying they breached the lab's founding agreement by putting commercial interests over the public good. Mr. Musk is asking for more than $150 billion in damages from OpenAI and Microsoft. Microsoft is also scheduled to report its quarterly earnings on Wednesday. (The New York Times sued OpenAI and Microsoft in 2023 for copyright infringement of news content related to A.I. systems. The two companies have denied those claims.) This is a developing story. Please check back for updates.

Microsoft drops its exclusive licence to OpenAI's technology

OpenAI can now sell to Amazon, Google, and any cloud and stops paying OpenAI a revenue share in return Both companies announced the revised agreement in a joint statement on Monday. Microsoft retains a non-exclusive licence to OpenAI's intellectual property through 2032, remains the primary cloud partner, and keeps its 27% equity stake. OpenAI will continue paying Microsoft a revenue share through 2030, capped at a total amount. Microsoft shares fell ~3% on the news; Amazon and Alphabet gained slightly. Microsoft and OpenAI announced on Monday that they have amended their partnership agreement in a restructuring that ends Microsoft's exclusive right to sell OpenAI's artificial intelligence models and products. Under the revised terms, Microsoft will retain a licence to OpenAI's intellectual property for models and products through 2032, but that licence will now be non-exclusive. OpenAI may now sell its products and serve customers across any cloud provider, not only Microsoft Azure. In exchange, Microsoft will no longer pay a revenue share to OpenAI on the products it resells. Revenue share payments running in the other direction, from OpenAI to Microsoft, will continue through 2030, independent of OpenAI's technology progress, at the same percentage but subject to a total cap. Microsoft remains OpenAI's primary cloud partner, and OpenAI products will continue to ship first on Azure unless Microsoft cannot or chooses not to support the necessary capabilities. The market read the agreement as a net negative for Microsoft and a net positive for its cloud rivals. Microsoft shares fell approximately 3% on Monday following the announcement. Amazon and Alphabet each gained slightly. The logic is straightforward: Microsoft's exclusive distribution rights were a structural competitive advantage in the cloud market that is now being surrendered. Azure had, until today, been the only public cloud on which OpenAI's most capable models were natively available, giving Microsoft a differentiation that drove enterprise Azure adoption at the height of the AI arms race in 2023 and 2024. The removal of exclusivity means AWS, Google Cloud, and Oracle Cloud can now offer OpenAI models directly to their customers, levelling the competitive landscape. For OpenAI, the logic runs in the opposite direction. The company's ability to strike deals with Microsoft's competitors has been constrained since its founding partnership was established. In February 2026, Amazon and OpenAI announced a major strategic partnership in which Amazon agreed to invest up to $50 billion in OpenAI and AWS will serve as the exclusive third-party cloud distribution provider for OpenAI's enterprise platform Frontier. OpenAI separately expanded its existing $38 billion AWS agreement by $100 billion over eight years. That announcement, which came while the exclusive Microsoft agreement was still nominally in place, raised the question of how OpenAI would navigate the apparent tension. Monday's restructuring is the answer: by renegotiating the Microsoft exclusivity away, OpenAI has given itself the contractual freedom to honour the Amazon commitment and to pursue further cloud distribution partnerships without restriction. The restructuring also removes one of the most legally unusual provisions in the original partnership: the AGI clause. Under the prior agreement, Microsoft was required to determine whether OpenAI had reached artificial general intelligence, a term for an AI system that rivals or exceeds human intelligence across a wide range of tasks, as a trigger for a change in the terms of the relationship. That clause reflected the theoretical possibility, important to OpenAI's nonprofit mission, that the moment of AGI arrival would require a different governance arrangement. The amended agreement, removes this clause entirely, simplifying the legal relationship and removing an asymmetric interpretive power from Microsoft that OpenAI may have found uncomfortable as the company has grown in commercial scale and strategic independence. The background to Monday's announcement is a six-month negotiation. In October 2025, when OpenAI completed its recapitalization as a public benefit corporation and Microsoft converted its investment at a valuation of $135 billion (representing approximately 27% of the company on a diluted basis), the two companies also committed OpenAI to spending $250 billion on Microsoft Azure cloud services. That commitment, and the revenue share arrangements associated with it, were the financial architecture of the original partnership. The Monday restructuring simplifies that architecture: Microsoft retains its equity position, its primary cloud status, and OpenAI's revenue share through 2030, but gives up the exclusivity and the obligation to pay its own revenue share. The net financial effect for Microsoft will depend on the relative size of the revenue share it was paying versus the revenue share it will continue to receive, figures that neither company has disclosed. The trial context is directly relevant. The Musk v. Altman case, which began jury selection on the same day, centres partly on the question of whether Microsoft aided and abetted OpenAI's breach of its nonprofit charter by facilitating the for-profit conversion. Monday's restructuring, which further simplifies and commercialises the Microsoft-OpenAI relationship, is not directly at issue in the trial but provides contextual evidence of the direction in which the relationship has been evolving since Musk left the board. For investors and enterprise customers, the more immediate question is whether the removal of exclusivity will materially change the competitive position of Azure vs AWS and Google Cloud for AI workloads, and the ~3% Microsoft share price decline suggests the market has answered that in the affirmative, at least for now.

Microsoft and OpenAI Rework AI Deal, Cutting Exclusivity and AGI Provisions - Decrypt

The changes take effect immediately while Microsoft retains its stake valued at over $135 billion. Microsoft will continue licensing OpenAI's technology through 2032, but is ending its exclusive partnership with the AI company, according to announcements from both firms Monday. Under the restructured agreement, OpenAI can serve all its products to customers across any cloud provider, ending Microsoft's previous status as exclusive cloud partner. Revenue share payments from OpenAI to Microsoft will continue through 2030, though other revenue-sharing arrangements are eliminated. The new agreement removes complex language that could have changed the partnership if OpenAI declared it had reached artificial general intelligence, or AGI. Microsoft's stake in OpenAI is valued at more than $135 billion, according to the New York Times. Microsoft retains its license to OpenAI intellectual property for models and products through 2032, preserving the tech giant's access to the underlying technology while OpenAI gains operational independence. The partnership restructuring follows Microsoft's earlier moves to diversify its AI relationships. In September, Microsoft said it would reduce reliance on OpenAI by purchasing models from rival Anthropic. Just recently, Microsoft launched an AI-powered tool called Copilot Researcher, which combines OpenAI's GPT and Anthropic's Claude with impressive results. When OpenAI raised $110 billion in fresh funding from Amazon, SoftBank, and Nvidia in February, the startup and Microsoft issued a joint statement saying that they continue to be close allies despite the AI giant's growing list of supporters. "Microsoft and OpenAI continue to work closely across research, engineering, and product development, building on years of deep collaboration and shared success," they said in February. "Microsoft maintains its exclusive license and access to intellectual property across OpenAI models and products. Collaborations like the partnership between OpenAI and Amazon were always contemplated under our agreements and Microsoft is excited to see what they build together." Microsoft's stock (MSFT) is down slightly since the opening bell on Monday, recently trading at $423 per share -- down about 0.3% on the day so far.

OpenAI breaks free from exclusive AI pact with Microsoft

Microsoft and OpenAI have agreed to drop the software giant's exclusive right to sell the startup's AI models, opening the door for the ChatGPT maker to pursue deals with cloud-computing rivals like Amazon. In exchange for ending that exclusivity -- which helped boost Microsoft's cloud sales in the early years of the AI boom -- the world's largest software maker will no longer pay a revenue share on OpenAI products it resells on its cloud. The two companies announced the revised deal in a joint statement on Monday (Tuesday AEST).

Microsoft Cuts OpenAI Revenue Share in a Fresh Step to Loosen Their AI Alliance

SAN FRANCISCO (AP) -- Microsoft said Monday it will no longer pay a share of its revenue to ChatGPT maker OpenAI, the latest move to untether a close partnership that helped unleash an artificial intelligence boom. OpenAI relied exclusively on Microsoft's investments in cloud computing services to build the technology that helped make ChatGPT a household name. Microsoft, in turn, relied on OpenAI's technology to build its own AI assistant Copilot. But the partnership has evolved as San Francisco-based OpenAI, founded as a nonprofit, has shifted to a capitalistic enterprise on a path toward an initial public offering on Wall Street and has balanced its reliance on Microsoft with other cloud partners like Amazon, Google and Oracle. OpenAI said Monday it will continue to pay Microsoft a share of its revenue through 2030. The two companies said Microsoft remains the primary cloud computing partner for OpenAI, and products made by the AI company will ship first on Microsoft's cloud platform, called Azure, "unless Microsoft cannot and chooses not to support the necessary capabilities." Wedbush Securities analyst Dan Ives said in a note to investors Monday that the new agreement "puts OpenAI on a strong path forward to going public through IPO given its clearer opportunity in the cloud environment while reducing significant barriers from its original partnership with Microsoft." Ives said it's also important for Microsoft as it "looks to develop tech independence from OpenAI" in advancing Copilot's capabilities and partnering with other AI providers such as OpenAI rival Anthropic, maker of the chatbot Claude.

Microsoft to end exclusive license for OpenAI's technology - The Economic Times

Microsoft's exclusive hold on OpenAI's artificial intelligence models is over. This change allows OpenAI to offer its technology to competitors like Amazon and Google. Microsoft will still be OpenAI's main cloud partner and has licensing rights until 2032. This development impacts the ongoing artificial intelligence race.Microsoft will no longer have exclusive access to OpenAI's artificial intelligence models and products, a significant change that will allow the startup to sell its technology across rival cloud platforms including Amazon and Google. Following the joint announcement, Microsoft ⁠shares ⁠slipped about 1% in premarket trading on Monday as some investors saw the shift as the company losing a valuable competitive advantage. Microsoft has in recent years emerged as a major player in the AI race, benefiting from its early bet on ⁠OpenAI that allowed it to quickly launch AI technology across its products. But tensions have been rising ⁠between the companies over the tie-up as OpenAI strikes cloud deals with rival companies and investors scrutinize Microsoft's alliance on OpenAI. The Financial Times reported in March Microsoft was weighing legal action against Amazon and OpenAI over a $50 billion cloud deal that could breach its exclusive cloud partnership. Under the reworked partnership, Microsoft will remain OpenAI's primary cloud partner and with will hold a license ⁠to ChatGPT creator's intellectual property through 2032. Microsoft will also not pay a revenue share to OpenAI. OpenAI products would also first ship on Microsoft's Azure cloud-computing platform unless the software giant cannot or chooses not to roll out the capabilities.

Microsoft Agrees to End Revenue-Sharing With OpenAI | PYMNTS.com

By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions. The new arrangement is designed to simplify the way the companies work together, OpenAI said in its announcement Monday (April 27). "The greater predictability in the amended agreement strengthens our joint ability to build and operate AI platforms at scale while providing both companies the flexibility to pursue new opportunities," OpenAI said. Under the new agreement, OpenAI can now serve all of its products to customers of any cloud provider, something the company had long hoped for. Microsoft will stay OpenAI's primary cloud partner, and OpenAI products will ship first on Azure, "unless Microsoft cannot and chooses not to support the necessary capabilities." While Microsoft will continue to have a license to OpenAI IP for models and products through 2032, the company's license will now be non-exclusive. Microsoft will continue to serve as a major shareholder in OpenAI, but will no longer pay a revenue share to the startup. Revenue share payments from OpenAI to Microsoft will proceed through 2030, "independent of OpenAI's technology progress," the company said. Under a previous arrangement, revenue share payments were set to stop and if OpenAI achieved artificial general intelligence (AGI), or a version of AI that can perform at or above the level of humans. The agreement said the determination of whether OpenAI had reached that milestone would be made by a panel of independent experts. "While this amendment simplifies the partnership, the work we're doing together remains ambitious," the companies said. "From scaling gigawatts of new datacenter capacity, to collaborating on next-generation silicon, to applying AI to advance cybersecurity, and more, we're excited to keep partnering to advance and scale AI for people and organizations around the world." Microsoft has invested more than $13 billion in OpenAI in the last seven years, though their partnership has seen evidence of strain in the last year as they compete with each other. This month saw a report from CNBC that OpenAI revenue chief Denise Dresser had written in a memo -- seen by the network -- that the collaboration had "limited our ability to meet enterprises where they are." She also praised the company's deal with Amazon, which will see the eCommerce giant invest up to $50 billion in OpenAI. "Since we announced the partnership at the end of February, inbound demand from our customers for this offering has been frankly staggering," Dresser wrote.

Microsoft will no longer have exclusive access to OpenAI's technology

Microsoft will no longer have exclusive access to OpenAI's artificial intelligence models and products, a significant change that would allow the startup to sell its technology across rival cloud platforms including Amazon and Google. Shares of Microsoft tumbled nearly three per cent after the announcement on Monday, while Alphabet and Amazon gained slightly. Under the reworked partnership, Microsoft will remain OpenAI's primary cloud partner and have a license to OpenAI intellectual property through 2032. The Windows maker has emerged as a major player in the artificial intelligence race in recent years thanks to its early bet and access to technology from the ChatGPT creator.