Microsoft and OpenAI have a new deal that could clear the way for an IPO

"Microsoft & OpenAI: Microsoft and OpenAI have signed a non-binding memorandum of understanding (MOU) for the next phase of our partnership. We are actively working to finalize contractual terms in a definitive agreement. Together, we remain focused on delivering the best AI tools for everyone, grounded in our shared commitment to safety. Microsoft has invested $13 billion in OpenAI since 2019, and shares in the revenue earned by ChatGPT as well as its API. Microsoft also now includes OpenAI as a competitor, allows OpenAI to lean on other cloud providers for compute power, and has started to increase its reliance on its own AI models."

"There was one specific detail about the agreement with Microsoft released by OpenAI in another statement, saying that its nonprofit parent company will continue to hold authority over the for-profit business, with an equity stake worth more than $100 billion. Other philanthropies and nonprofits have reportedly pushed back against OpenAI's unusual restructuring plan, and the attorneys general of California and Delaware have opened investigations."

"In a company town hall meeting on Thursday, Microsoft CEO Satya Nadella and AI chief Mustafa Suleyman committed to "significant investments in its own models. "We should have the capacity to build world class frontier models in house of all sizes, but we should be very pragmatic and use other models where we need to," said Suleyman."

A non-binding memorandum of understanding was signed to begin the next phase of the Microsoft–OpenAI partnership while definitive contractual terms are finalized. Microsoft has invested $13 billion in OpenAI since 2019 and shares revenue from ChatGPT and its API. Microsoft now treats OpenAI as a competitor, permits OpenAI to use other cloud providers for compute, and is increasing reliance on its own AI models. Microsoft leaders pledged significant investments to build frontier models in house while remaining pragmatic about using other models. OpenAI's nonprofit parent will retain authority and a stake over $100 billion, amid nonprofit pushback and state investigations in California and Delaware.

Read at The Verge