OpenAI Plans to Lower Microsoft's Revenue Share
OpenAI anticipates reducing the percentage of revenue it shares with Microsoft by 2030. Currently, OpenAI shares 20% of its top-line revenue with Microsoft. However, internal financial documents suggest this figure could drop to 10% by the end of the decade, according to reporting by The Information.
This development follows OpenAI's recent restructuring announcement, shifting its for-profit arm towards a public benefit corporation (PBC) model, while remaining under the control of its non-profit division. This restructuring is still pending Microsoft's approval, as the tech giant seeks to protect its substantial multi-billion dollar investment in OpenAI, as reported by Bloomberg.
Microsoft's Investment and Current Agreement
Microsoft's investment in OpenAI amounts to tens of billions of dollars. The two companies are bound by a contract until 2030, which includes revenue sharing from both sides. This agreement also grants Microsoft rights to OpenAI's intellectual property within its AI products and exclusive access to OpenAI's APIs on Azure.
The proposed reduction in revenue sharing could significantly impact the dynamics of this partnership. While OpenAI aims to reduce its share to 10% for all business partners, including Microsoft, the exact implications for the existing agreement remain unclear.
Both OpenAI and Microsoft have yet to comment publicly on these reports.
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