OpenAI, Microsoft discuss shape of future relationship

Microsoft and OpenAI are in talks about the future of their partnership, they said in a joint statement Thursday, without providing details. Separately, OpenAI said it wants to go ahead with its previously announced plan to turn its for-profit business into a public benefit corporation, in which its nonprofit organization would own a $100 billion stake.

“Microsoft and OpenAI have signed a non-binding memorandum of understanding for the next phase of our partnership,” the companies said in a document described as a joint statement, continuing, “Together, we remain focused on delivering the best AI tools for everyone, grounded in our shared commitment to safety.”

Contacted by Computerworld, Microsoft declined to provide additional details of the agreement.

However, in a separate statement on its website, OpenAI said that it plans to turn some of its business activities into a public benefit corporation — a type of company that operates for profit but also considers the public good in its decisions — and enable the non-profit to share in its success.

OpenAI’s structure is complex, consisting of several similarly-named entities: OpenAI, Inc. is the non-profit, and it wholly owns OpenAI GP LLC. But there is also OpenAI LP, OpenAI LLC, OpenAI Holdings LLC, and OpenAI Global, LLC, with the latter describes as “a high-risk investment,” and it is not always clear to which entity the name “OpenAI” refers:

The key change OpenAI announced Thursday is that it plans for its nonprofit organization to own an equity stake in the future public benefit corporation that, it says, will be worth at least $100 billion. That’s a big number, but the last investment round in OpenAI’s for-profit company valued it at over $300 billion, so the nonprofit’s stake would be barely a third of that. Neverthless, this would make the nonprofit “one of the most well-resourced philanthropic organizations in the world,” according to a Thursday blog post by OpenAI Chairman Bret Taylor.

“OpenAI started as a nonprofit, remains one today, and will continue to be one — with the nonprofit holding the authority that guides our future,” Taylor wrote.

Microsoft and OpenAI are seeking to reach an agreement on OpenAI’s future structure because both companies needed something from each other: OpenAI needs Microsoft’s permission to restructure because of their existing partnership agreements, while investors such as SoftBank have committed billions to OpenAI but only if the company changes its structure. Meanwhile, Microsoft wants to maintain its relationship with OpenAI while gaining flexibility to work with other AI companies.

Structure balances profit with AI safety oversight

A new arrangement could solve a fundamental problem facing AI companies: how to raise the billions needed for AI development while maintaining oversight to ensure the technology is built safely and responsibly, analysts said.

“OpenAI’s decision to recast its for-profit arm as a public benefit corporation while keeping control in the hands of its nonprofit parent is without precedent at this scale,” said Sanchit Vir Gogia, chief analyst and CEO at Greyhound Research. “It is a structure that fuses two competing logics: the relentless need to raise capital for models that cost billions to train, and the equally strong pressure from regulators, investors, and the public to demonstrate accountability.”

The proposed structure enables OpenAI to attract traditional investors who expect potential returns, while the nonprofit parent can ensure safety considerations aren’t sacrificed for profit. However, Gogia warned the hybrid model is “as much a gamble as it is an innovation,” noting concerns about “who carries liability if something goes wrong, whether fiduciary duty to investors will override social commitments when revenues are threatened.”

Charlie Dai, VP and principal analyst at Forrester, said the structure “could influence others because it balances capital access with mission-driven oversight” but warned that “regulatory scrutiny, lawsuits, and governance complexity introduce uncertainty around decision-making speed and long-term stability.”

Microsoft pivots to ecosystem orchestrator as partnership terms evolve

The agreement comes against the backdrop of mounting tensions between the two companies. Microsoft had already begun diversifying its AI partnerships, with reports this week that it will integrate Anthropic’s AI models into Office 365 applications alongside OpenAI’s technology.

Meanwhile, OpenAI had been seeking more diversity in its infrastructure, recently signing a contract to spend $300 billion with Oracle over five years starting in 2027, signaling its desire to reduce dependence on Microsoft’s Azure platform.

Monopoly is out, and optionality is in, said Greyhound’s Gogia, adding, “Microsoft’s shift away from exclusive dependence on OpenAI towards a diversified stable of models is not just an adjustment of supplier strategy, it is a redefinition of how AI will be consumed at enterprise scale.”

Dai predicted the move will pressure other hyperscalers to “open ecosystems and offer curated model and AI agent marketplaces,” resulting in competitive pricing and innovation-driven procurement becoming standard practice.

OpenAI’s transformation still faces regulatory hurdles, with Taylor writing that the organization will “continue to work with the California and Delaware Attorneys General” on the public benefit corporation’s charter.

It must also contend with opposition to the plan from Elon Musk, who has accused the startup in a lawsuit of defrauding investors. He was among the first to fund OpenAI.

What enterprises should watch for

The attempt by Microsoft and OpenAI to negotiate a restructuring indicates how quickly AI partnerships can evolve, but also how complex the changes can be, creating opportunities and risks for enterprise customers.

For Gogia, restructuring of the Microsoft-OpenAI deal is “not an immediate service disruption, but a powerful reminder” that vendor alliances can change overnight. “Enterprises are learning that resilience is not about whether a model is fast or cheap today, but whether access is guaranteed tomorrow, regardless of how the vendor reshuffles its governance or partnerships.”

Both analysts emphasized that CIOs should focus on understanding the governance mechanics behind their AI vendors. Gogia advised CIOs to interrogate AI vendors less about marketing roadmaps and more about governance mechanics: “Who holds veto power if corporate structures shift? How are SLAs enforced if model stewardship changes hands?” he said.

Dai recommended enterprises assess “how it will affect service continuity and contractual obligations” and seek “clarity on model interoperability, portability, and exit options if partnerships evolve.”