TLDR
- Microsoft will stop paying revenue share on OpenAI products resold through Azure.
- OpenAI can now offer products across rival cloud platforms, including AWS.
- Microsoft keeps access to OpenAI model and product IP until 2032.
- OpenAI will keep revenue share payments to Microsoft until 2030 under a cap.
- Microsoft remains OpenAI’s main cloud partner, but exclusivity has ended.
OpenAI has gained more room to sell its AI products across cloud platforms. Microsoft has ended revenue sharing on OpenAI products it resells through Azure. The revised deal also ends Microsoft’s exclusive license to OpenAI technology.
OpenAI gets more room beyond Azure
Microsoft and OpenAI have revised their long-running AI partnership. The new terms give OpenAI more freedom to serve customers on different cloud platforms. Microsoft remains OpenAI’s main cloud partner.
OpenAI products will still get priority on Azure. However, OpenAI can now offer its products to users on other cloud services. That change opens the door to platforms such as Amazon Web Services and Google Cloud.
The companies said the revised deal supports “flexibility, certainty and broader promotion of AI adoption.” The change also fits OpenAI’s growing demand for computing power. Many crypto firms also use cloud services for trading, security and data systems.
Revenue sharing terms change under new deal
Microsoft will stop paying revenue share to OpenAI on products it resells through Azure. This removes a fixed payment from Microsoft’s cloud sales model. However, OpenAI will still pay Microsoft under earlier revenue share terms.
Those OpenAI payments will continue until 2030. The report said the rate remains the same. Yet the total amount will now face a cap.
Microsoft’s license to OpenAI models and product technology will run until 2032. That license has moved from exclusive to nonexclusive. As a result, OpenAI can work with more cloud providers while Microsoft keeps access.
Market watches cloud race after deal update
Microsoft shares fell in early trading after the announcement. The stock later recovered part of its losses during the session. Amazon shares rose about 1%, according to the report.
The market is watching whether AWS gains new business from OpenAI. Amazon could benefit as OpenAI expands beyond Azure. Google Cloud may also compete for AI workloads.
The deal keeps Microsoft close to OpenAI, but it changes the balance. OpenAI gains wider options for cloud access and customer reach. Microsoft keeps a key AI partner, while losing its exclusive position.
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