OpenAI is reportedly planning to reduce the amount of revenue it pays to biggest investor and close partner, Microsoft.
According to the Information, which cited financial projections shared with investors, OpenAI has said it will share a smaller fraction of revenue with Microsoft as it moves ahead with its restructuring.
Earlier this week OpenAI had backtracked on its decision in September 2024 to restructure itself into “for-profit benefit corporation” after some pushback to the move.
The AI pioneer this week confirmed that going forward it will continue to be overseen and controlled by non-profit operation, in a move that could potentially limit CEO Sam Altman’s power over the firm.
Revenue sharing
Despite that, the lawyer for Elon Musk (owner of rival xAI) said the billionaire will continue to pursue his latest lawsuit against the firm, which a spokesperson for OpenAI said “…only proves that it was always a bad-faith attempt to slow us down.”
Now the Information reported that OpenAI plans to share a smaller fraction of revenue with Microsoft as it moves ahead with its restructuring.
In financial projections shared with investors, OpenAI reportedly said the percentage of revenue shared with Microsoft would drop by at least half by the end of this decade.
In an existing deal, OpenAI has agreed to share 20 percent of its revenue with Microsoft through 2030, the Information reported.
OpenAI told some potential and current investors that it would only share 10 percent of revenues with commercial partners including Microsoft by 2030, the report said, adding that Microsoft wants access to OpenAI’s technology beyond 2030.
In January, Microsoft reportedly changed some key terms of a deal with OpenAI after its joint ‘Stargate’ venture with Oracle and Japan’s SoftBank Group to build up to $500 billion of new artificial intelligence data centres in the United States.
Cooling relationship?
Meanwhile some media reports have hinted at a cooling relationship between Microsoft and OpenAI.
The Wall Street Journal for example reported that the marriage between the two firms is “on the rocks”, with Altman and Satya Nadella apparently “drifting apart.”
Matter would not have helped after it was reported last week that Microsoft is getting ready to host Elon Musk’s Grok AI model, which a rival to OpenAI’s ChatGPT.
Some reports have suggested that Altman has already complained about a lack of capacity for its ChatGPT model (OpenAI widely utilises Microsoft’s Azure cloud services).
Microsoft of course is a big backer of OpenAI from its startup days, and has sunk billions of dollars into the San Francisco-based AI pioneer over the years.
In return Microsoft uses OpenAI technology for most of its AI offerings (although it was recently revealed that is working to bring internal and third-party models into its enterprise AI offering, 365 Copilot).