OpenAI, a leading artificial intelligence company, originally planned to complete the company's transformation plan by the end of this year, but sources said that due to unsatisfactory negotiations with its major shareholder Microsoft, OpenAI's restructuring may be postponed until next year.
The original agreement between Microsoft and OpenAI lasts until 2030, so OpenAI's reorganization must reach a consensus with Microsoft to modify the existing commercial contract terms. However, many people revealed that there are many disputes between Microsoft and OpenAI and differences on key issues.
The reorganization is necessary to support OpenAI’s future IPO and is also an important condition for the company to obtain additional investment from SoftBank. According to the terms of the investment with SoftBank, if OpenAI cannot complete its restructuring by December 31 this year, SoftBank will have the right to suspend its $10 billion capital injection commitment.
This delay may hinder OpenAI’s subsequent financing, and may also dampen the enthusiasm of other investors for OpenAI.
Contradiction
It is reported that the main dispute between OpenAI and Microsoft is Microsoft’s access to the OpenAI application programming interface (API). Microsoft has exclusive rights to host OpenAI models on its Azure cloud service, but OpenAI is pushing for more partnerships with Google and Amazon cloud services.
This will boost OpenAI's API sales, which currently account for about a quarter of its $12 billion in annual revenue. But Microsoft doesn't want to open its cloud service channels to its competitors. Sources said the two sides are negotiating a limited agreement that would allow OpenAI to provide competitor services only to government customers that do not use Azure.
In addition, the two companies are also negotiating over Microsoft's future access to OpenAI's intellectual property rights. The focus is whether Microsoft can control the training process of OpenAI's future models, or whether it will only be allowed to use the model in products.
There is also a controversy over the general artificial intelligence clause, which gives OpenAI the power to cut off Microsoft's access to intellectual property when implementing general artificial intelligence. It is a powerful bargaining chip for the company to check Microsoft. But Microsoft hopes to abolish this clause.
Outside of Microsoft, there are many factors that hinder OpenAI's restructuring, such as negotiations with other shareholders and with the attorney general of the place where OpenAI operates and is registered. These thorny issues further reduce the company's possibility of completing restructuring negotiations this year.
However, although the road to restructuring is full of thorns, OpenAI executives firmly believe that SoftBank will not divest. They believe that with the company's rapid growth since SoftBank's investment, it can continue to obtain financing even if it maintains its current structure.
At the same time, OpenAI is discussing a secondary stock offering with investors, which will value it at US$500 billion, a significant increase from the US$300 billion valuation when SoftBank led the investment. According to people familiar with the matter, other investors are interested in participating in financing at a higher valuation.