Microsoft, OpenAI outline new partnership phase, $100B equity shift to nonprofit arm

HIGHLIGHTS

The revised agreement eases earlier limits on Microsoft’s access to OpenAI’s most advanced AI systems.

OpenAI’s nonprofit parent will receive a $100B+ equity stake, ensuring oversight and control.

The restructuring paves the way for OpenAI’s shift to a public benefit corporation and potential IPO.

Microsoft and OpenAI are reportedly planning to deepen their collaboration through a new agreement that redefines how the two companies will share technology and revenue. Both companies have confirmed that they have signed a non-binding memorandum of understanding, though the specifics of the agreement have yet to be finalised.

Survey

Thank you for completing the survey!

${q.options.map(opt => `

${opt}

`).join(“”)}

`;

// trigger animation
const inner = qaContainer.querySelector(“.qa-inner”);
setTimeout(() => inner.classList.add(“show”), 50);

document.querySelectorAll(“input[name=”answer”]”).forEach(radio => {
radio.addEventListener(“change”, () => submitAnswer(radio.value));
});
}

function showThankYou() {
thankYouBox.style.display=”block”;
setTimeout(() => thankYouBox.classList.add(“show”), 50);
}

function submitAnswer(answerValue) {
const finalPayload = {
campaign_name: “Digit Questionaire”,
form_name: “Digit Questionaire_Form 1”,
form_data: [
{ key: “uuid”, value: deviceId, type: “text” },
{ key: “question”, value: questions[currentQuestionIndex].question, type: “text” },
{ key: “response”, value: answerValue, type: “text” }
],
verification_data: {
captcha_verification: “”,
captchaValue: null,
captchaId: null,
phone_verification: false,
email_verification: false
},
meta_data: {
referer: document.referrer || window.location.href,
user_agent: getDeviceType()
}
};

const myHeaders = new Headers();
myHeaders.append(“accept”, “*/*”);
myHeaders.append(“origin”, ”
myHeaders.append(“user-agent”, navigator.userAgent);

const formdata = new FormData();
formdata.append(“finalPayload”, JSON.stringify(finalPayload));

fetch(” {
method: “POST”,
headers: myHeaders,
body: formdata
})
.then(res => res.text())
.then(result => console.log(“Submitted:”))
.catch(err => console.error(“Error:”));

currentQuestionIndex++;
progress++;
setCookie(“progress”, progress);

if (currentQuestionIndex < endIndex) {
showQuestion(currentQuestionIndex);
} else {
qaBox.classList.add(“hide”);
setTimeout(() => {
qaBox.style.display=”none”;
showThankYou();
}, 600);
}
}

if (currentIndex < questions.length) {
qaBox.style.display=”block”;
setTimeout(() => qaBox.classList.add(“show”), 1200);
showQuestion(currentIndex);
}

According to the New York Times, the revised agreement changes an earlier provision that limited Microsoft’s access to OpenAI’s most advanced systems if the company’s board determined they had achieved artificial general intelligence (AGI). It demonstrates the recalibration of the rules that govern their relationship, particularly as OpenAI transitions to a new corporate structure.

“OpenAI and Microsoft have signed a non-binding memorandum of understanding (MOU) for the next phase of our partnership. We are actively working to finalize contractual terms in a definitive agreement. Together, we remain focused on delivering the best AI tools for everyone, grounded in our shared commitment to safety,” OpenAI stated.

On the other hand, OpenAI is said to be giving its nonprofit parent an equity stake worth more than $100 billion. This ensures that the nonprofit retains oversight and control as the company prepares to transform into a public benefit corporation, a model that combines profit-making with social responsibility and lays the groundwork for an eventual IPO.

READ: Apple iPhone 17 series pre-booking starts today: India price, offers, EMI options, when and where to pre-book new iPhone

Microsoft has already invested more than $13 billion in OpenAI and owns 49 percent of its future profits. To move forward with the restructuring, OpenAI needed to negotiate new equity and governance terms with its largest backer.

For those who are unfamiliar, the creator of ChatGPT has announced plans to simplify its complex nonprofit-for-profit setup. While the company initially considered limiting its nonprofits’ authority, it reversed course earlier this year, reaffirming that its nonprofit board will retain ultimate control over the AI pioneer’s direction.

Ashish Singh

Ashish Singh is the Chief Copy Editor at Digit. He’s been wrangling tech jargon since 2020 (Times Internet, Jagran English ’22). When not policing commas, he’s likely fueling his gadget habit with coffee, strategising his next virtual race, or plotting a road trip to test the latest in-car tech. He speaks fluent Geek. View Full Profile

_{Images are for reference only.Images and contents gathered automatic from google or 3rd party sources.All rights on the images and contents are with their legal original owners.}