TEMPO.CO, Jakarta – Microsoft and OpenAI have signed a new agreement covering intellectual property rights and investments. The partnership is evident in Microsoft’s support for OpenAI’s formation as a Public Benefit Corporation (PBC) and its subsequent recapitalization.
“Following the recapitalization, Microsoft holds an investment in OpenAI Group PBC valued at approximately $135 billion, representing roughly 27 percent on an as-converted diluted basis, inclusive of all owners – employees, investors, and the OpenAI Foundation,” Microsoft and OpenAI stated in a joint announcement on Wednesday, October 28, 2025.
However, this figure does not include the impact of OpenAI’s latest funding round. When calculated based on the conversion in OpenAI’s previous nonprofit organization, Microsoft holds about 32.5 percent of the shares.
OpenAI continues to collaborate with Microsoft as a partner in utilizing the latest Artificial Intelligence (AI) model for Microsoft. Microsoft retains exclusive intellectual property rights to the use of the Azure Application Programming Interface (API) and Artificial General Intelligence (AGI).
“It also refines and adds new provisions that enable each company to independently continue advancing innovation and growth,” Microsoft and OpenAI wrote.
In this new arrangement between the two, verification will be conducted by an independent panel of experts after OpenAI declares AGI. Microsoft’s intellectual property rights for models and products are extended until 2032 and encompass post-AGI models.
Microsoft retains intellectual property rights for its research methods used to develop models and systems until an expert panel confirms AGI achievement or until 2030, whichever comes first.
The intellectual property in this research includes models used solely for research or internal use. Beyond that, the intellectual property does not cover aspects such as model architecture, model weights, inference code, refinement code, or data center hardware and software technology. For non-research components, Microsoft retains separate intellectual property rights. “Microsoft’s IP rights now exclude OpenAI’s consumer hardware,” Microsoft and OpenAI stated.
The new agreement stipulates that OpenAI can collaborate with third parties to develop products. However, products developed with third parties using the API will be exclusive to Azure. Non-API products, on the other hand, can be provided to any cloud provider.
Similarly, Microsoft can develop AGI on its own or in partnership with third parties. If Microsoft uses OpenAI’s intellectual property to develop AGI before its declaration, the model will be subject to a computational threshold.
The profit-sharing agreement remains in place until experts verify AGI, although the payments will be made over a longer period. “OpenAI has contracted to purchase an incremental $250B of Azure services, and Microsoft will no longer have a right of first refusal to be OpenAI’s compute provider,” Microsoft and OpenAI stated.
OpenAI can now provide the U.S. government’s national security customers with API access, regardless of the cloud provider. The company can release open-weight models that meet the necessary criteria for capability.
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