OpenAI seeks significant concessions from Microsoft in exchange for equity in the restructured entity

OpenAI Seeks Major Concessions from Microsoft in Exchange for Equity in Reorganized Entity

OpenAI is seeking to negotiate with its largest investor, Microsoft, regarding the restructuring plan of its for-profit division and is seeking a number of major concessions in this regard. A person familiar with the matter said that OpenAI hopes Microsoft will give up its rights to the future profits of the AI startup in exchange for a 33% stake in its reorganized division. OpenAI also seeks to further end its exclusive cloud computing contract with Microsoft, which was recently converted into a "preferred procurement" contract. In return, Microsoft hopes to obtain a long-term guarantee of access to OpenAI's models after the contract ends in 2030. In recent months, Microsoft seems to be pulling back from its cooperation with OpenAI, especially as negotiations over the company's restructuring of its for-profit division appear to have stalled. OpenAI still needs to obtain Microsoft's approval for the restructuring. The AI startup is seeking to transform its division into a public benefit corporation.

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