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Microsoft and OpenAI Set Reported $38 Billion Cap on Revenue Sharing

The cap signals clearer economics for OpenAI before a possible IPO.

Overview

  • The Information reported the partners agreed to limit total revenue-sharing to $38 billion, citing a person familiar with the arrangement.
  • An April update to the partnership let OpenAI offer its products on any cloud, with Microsoft stating new OpenAI services launch first on Azure unless it cannot support them.
  • Enterprises can now use OpenAI tools on providers like Amazon Web Services or Google Cloud without moving workloads to Azure.
  • Benzinga reported Microsoft holds a non-exclusive license to OpenAI models and products through 2032 and that OpenAI pays Microsoft a revenue share through 2030 under the cap.
  • Microsoft has invested about $13 billion in OpenAI since 2019, and the reported cap is presented as a way to clarify the venture’s long-term finances for investors.