Apr. 27 at 10:53 PM
DEAL NEWS
OpenAI Off The Leash 🔓
Microsoft and OpenAI rewrote their partnership agreement on Monday, scrapping the software giant's exclusive right to sell OpenAI's models and handing the ChatGPT maker permission to cut deals with cloud rivals.
$MSFT fell about -1% on the open.
“The greater predictability in the amended agreement strengthens our joint ability to build and operate AI platforms at scale while providing both companies the flexibility to pursue new opportunities," OpenAI and Microsoft said in a joint statement Monday.
The RIP: Microsoft loses exclusivity over OpenAI's IP and models, effective immediately.
$MSFT stops paying OpenAI a revenue share on resold products; OpenAI keeps paying Microsoft a revenue share through 2030, capped at an undisclosed ceiling. Microsoft retains "primary cloud provider" status with first access to new OpenAI products on Azure. Microsoft holds a 27% ownership stake in OpenAI from last year's restructuring.
$MSFT shares have lost ~20% over the past six months, while
$AMZN is up +17% and
$GOOGL up +30% in the same stretch.
"We do not believe this revised agreement should come as a major surprise to investors at this point," Evercore ISI analysts wrote Monday, noting Microsoft has increasingly signaled interest in a multi-model strategy.
The exclusivity clause was always a slow-motion problem for OpenAI: it needed Amazon's cloud capacity, but Microsoft reportedly weighed legal action over an AWS deal announced earlier this year. Monday's agreement resolves that standoff without blowing up the partnership.
The tickers most exposed:
$MSFT faces more OpenAI-competitive pressure across Azure and M365;
$AMZN is the clearest near-term winner as AWS can now host OpenAI products without legal overhang;
$GOOGL gets a more fragmented cloud-AI market it can compete in; and SaaS names like
$CRM and
$NOW already down -31% YTD are watching OpenAI become an enterprise software competitor in real time. 🔓
