Microsoft and OpenAI signed a definitive agreement that extends Microsoft’s rights to OpenAI’s models and products through 2032.
This confirms Microsoft’s continuing role as OpenAI’s “frontier model partner.”
Key Terms Of The Deal
- Microsoft continues to have exclusive IP rights and Azure API exclusivity until Artificial General Intelligence (AGI).
- Any AGI declaration by OpenAI will be subject to review by an independent expert panel.
- OpenAI has contracted to purchase an incremental $250 billion of Azure services.
- Microsoft gives up its previous right of first refusal to always be OpenAI’s compute provider.
- OpenAI can now jointly develop some products with third parties.
- API products built with third parties must still run on Azure.
- OpenAI can now provide API access to U.S. government national security customers on any cloud, and it’s allowed to release certain open-weight models.
What Changed?
This agreement moves the relationship between Microsoft and OpenAI from provisional terms into a long-term structure.
Microsoft publicly disclosed its ownership position, saying its investment represents roughly 27% on an as-converted diluted basis in OpenAI Group PBC, and values that stake at about $135 billion.
The companies also changed how exclusivity works. Microsoft keeps exclusive IP rights and Azure API exclusivity, but OpenAI can now collaborate with other partners.
In what may prove to be one of the more meaningful changes, AGI declarations will now be reviewed by an independent expert panel. Further, Microsoft’s IP rights extend to post-AGI models through 2032, subject to safety guardrails.
Why This Matters
This provides clarity around Microsoft’s roadmap.
Microsoft is telling you that Copilot, Bing’s AI answers, and related products will keep getting OpenAI’s newest models for years. Microsoft’s rights to OpenAI’s models and products now run through 2032 and include post-AGI scenarios.
These aren’t temporary experiments, this is a contractual agreement. The $250 billion Azure commitment shows both sides are planning to scale, not wind down.
Looking Ahead
OpenAI’s new flexibility to work with third parties means you may start seeing OpenAI-quality models in tools that aren’t branded Microsoft.
At the same time, Microsoft keeps preferential access to OpenAI’s frontier models for Copilot, Bing AI answers, and other AI surfaces in Microsoft’s ecosystem.
Featured Image: jrdes/Shutterstock
