OpenAI Canceled Microsoft Sale Exclusivity

OpenAI revised an agreement with Microsoft, which gave the software giant exclusive rights to sell the former’s AI models. The move is paving the way for the AI company to expand across rival cloud platforms.

The AI player said the amended deal delivers flexibility, certainty, and a focus on delivering the benefits of AI broadly, while enabling the pair to pursue new opportunities. “The rapid pace of innovation requires us to continue to evolve our partnership,” OpenAI explained. “The greater predictability in the amended agreement strengthens our joint ability to build and operate AI platforms at scale.”

Microsoft will no longer pay a revenue share on OpenAI products it resells through its cloud platform. The companies also capped revenue share paid by OpenAI to Microsoft on its direct product sales. Despite the reset, Microsoft will remain the ChatGPT-maker’s primary cloud partner, with its new products set to debut first on Azure. The software company will also retain its license to OpenAI’s intellectual property until 2032, though it is now non-exclusive.

The revised agreement clears a path for the AI player to offer its products through multiple cloud providers, including Microsoft's rival Amazon Web Services (AWS). Last year, the pair struck a $38 billion partnership and later announced they were jointly developing an AI service to be hosted on AWS’s Amazon Bedrock platform. The update follows OpenAI’s shift to a for-profit structure last year, which handed early investor Microsoft a 27% stake in the business.

Microsoft first invested in OpenAI in 2019, committing $1 billion to develop AI systems on Azure and becoming its exclusive cloud provider. The pair deepened their partnership in 2023, when Microsoft made a $10 billion investment in the company to deploy OpenAI’s models across its consumer and enterprise products.