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Microsoft and OpenAI remove a clause that would have given Microsoft IP rights until OpenAI achieved “AGI”; Microsoft retains use of OpenAI's models until 2032

Aaron Holmes /The Information:

The Information Aaron Holmes

Context & Ripple Effects

The Microsoft–OpenAI agreement has been repeatedly renegotiated around what happens if OpenAI reaches an AGI threshold. Earlier coverage described discussions to remove or modify a provision that could cut off Microsoft’s access to OpenAI technology at that point.

The later deal already established Microsoft’s model access through 2032 and gave OpenAI more latitude to build products with third parties. This revision further separates a defined access term from an AGI-triggered IP entitlement.

First-order effects

  • Microsoft keeps contractual rights to use OpenAI models through 2032, while losing the clause that would have granted it IP rights up to an AGI milestone.
  • OpenAI removes an AGI-linked constraint on ownership/control of its IP within the Microsoft relationship.

Second-order effects

  • The partners can operate against a clearer contractual boundary: Microsoft’s model-use rights are time-based, while OpenAI has greater room to manage IP and outside product relationships.
  • The change reduces the practical importance of defining or adjudicating an AGI trigger for this particular IP-rights provision, even as access to frontier models remains central to the partnership.

Third-order effects

  • Frontier-model partnerships may increasingly rely on explicit access periods and narrower rights grants rather than sweeping provisions tied to an uncertain technical milestone.
  • If replicated, this approach would shift bargaining toward governance of model access, commercialization rights, and partner autonomy—not ownership claims contingent on AGI.

The trend: This is part of a broader move to replace AGI-contingent partnership terms with more concrete rules for frontier-model access and IP control.

Related: Conditional model access · Frontier-model access governance · Microsoft · OpenAI · Microsoft gets access to OpenAI tech through 2032, including models post-AGI but excluding consumer hardware; OpenAI can now develop products with third parties · Sources: OpenAI is discussing ditching a clause that cuts off Microsoft's access to OpenAI tech if OpenAI develops AGI, so that Microsoft can continue investing

Related Coverage

Discussion

  • @kyliebytes Kylie Robison on x
    That was among the biggest sticking points between the two companies. I remember not many months ago, I was told that that this clause was critical leverage for OpenAI! Now, vamoose!
  • @kyliebytes Kylie Robison on x
    No more AGI clause is huge: “Revenue share payments from OpenAI to Microsoft continue through 2030, independent of OpenAI's technology progress, at the same percentage but subject to a total cap.”
  • @aaronpholmes Aaron Holmes on x
    Dropping the AGI clause is the biggest win for Microsoft in today's deal - removes a ton of uncertainty around whether they'd retain OpenAI IP rights in the coming years
  • @aaronpholmes Aaron Holmes on x
    NEW: MSFT and OpenAI have scrapped the controversial “AGI” clause from their deal. Now MSFT has IP rights until 2032, but they aren't exclusive, meaning OAI can sell via AWS and other clouds. And Microsoft will stop sharing rev from OAI sales on Azure: https://www.theinformation.…
  • @reckless Nilay Patel on bluesky
    If anyone thought LLMs would actually get to AGI this clause would still exist, just sayin www.theverge.com/ai-artificia...