Better Offline Monologue: OpenAI Vs. Microsoft
19 snips
Jun 20, 2025 Tensions are escalating between OpenAI and Microsoft as they navigate a complex financial relationship. OpenAI's shift towards a for-profit model raises questions about control and profit-sharing. The struggle for autonomy against Microsoft's dominance is becoming increasingly critical. With OpenAI seeking new concessions, the future of this partnership hangs in the balance. Meanwhile, innovative strategies are essential for OpenAI to secure funding and overcome legal hurdles, showcasing the high stakes in the AI landscape.
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OpenAI-Microsoft Deal Control
- OpenAI's 2019 deal with Microsoft gives Microsoft full rights to its AI models and IP and control over its for-profit conversion.
- Microsoft owns nearly half of OpenAI's profits and offers discounted Azure hosting, making OpenAI highly dependent on Microsoft.
OpenAI's Negotiation Demands
- OpenAI demands reducing Microsoft's profit share and access to intellectual property, partly due to a competing acquisition.
- Microsoft resists these demands, highlighting tensions as OpenAI attempts questionable tactics in negotiations.
OpenAI Undercuts Microsoft Sales
- OpenAI is undercutting Microsoft by discounting ChatGPT enterprise, directly competing with Microsoft’s Co-Pilot.
- This dual selling causes confusion and inefficiency, hurting both companies’ business interests.