Microsoft is negotiating with OpenAI to maintain access to its technology should the company develop artificial general intelligence (AGI), amid ongoing talks over OpenAI’s planned shift to a for-profit structure.
Under the current agreement, Microsoft would lose access to any new technology if OpenAI’s board determines that AGI has been achieved, Bloomberg reported on July 29.
Barriers to OpenAI becoming for-profit organisation
This clause has been a barrier to OpenAI’s ambitions to become a for-profit entity, but the new deal could help advance that goal.
Citing anonymous sources, Bloomberg said that the companies could come to an agreement in a matter of weeks, but that this could change because a deal has not been finalised.
Both Microsoft and OpenAI failed to react to the report when PYMNTS contacted them to seek clarity.
Renegotiation of relationship
The report claims that since OpenAI revealed its intentions to turn into a for-profit business, the companies have been renegotiating their relationship.
According to the report, Microsoft has blocked the move due to disagreements over the size of its ownership stake in OpenAI and its access to its technology, despite having invested roughly $13.75 billion in the company.
According to a September report, OpenAI intended to reorganise its core operations into a benefit corporation that would be for-profit and independent of its nonprofit board.
Because it would function more like a normal startup, the planned restructuring would increase the company’s appeal to investors.
Originally established in 2015 as a nonprofit organisation dedicated to AI research, OpenAI LP is now a for-profit company that is a subsidiary of the nonprofit.
Ongoing discussion between Microsoft and OpenAI on company restructuring
According to a December report, Microsoft and OpenAI had been discussing how to restructure the AI company since October.
According to reports at the time, the discussions focused on Microsoft’s ownership stake in the for-profit company, whether Microsoft would remain OpenAI’s sole cloud provider, how long Microsoft would be able to use OpenAI’s intellectual property in its products, and whether Microsoft would keep receiving 20 percent of OpenAI’s profits.
Although the market and the company’s preparedness would determine when to launch an IPO, it was reported in May that OpenAI’s planned reorganisation might facilitate its IPO.