Microsoft and OpenAI Forge Groundbreaking Partnership

Microsoft has reached a deal with OpenAI to allow the AI startup to restructure into a public benefit corporation. Microsoft will hold a 27% stake, valued at $135 billion. Concurrently, OpenAI will purchase $250 billion in Azure services, as Microsoft relinquishes first refusal rights on computing services.

In a pivotal move for the tech industry, Microsoft has announced an unprecedented deal with OpenAI, the creator of ChatGPT, to restructure the AI entity into a public benefit corporation. This strategic alliance grants Microsoft a notable 27% stake in OpenAI, a share valued at approximately $135 billion.

The announcement on Tuesday caused a 4% rise in Microsoft shares, highlighting investor confidence in the partnership's potential. This agreement not only cements Microsoft's influence in the AI space but also sets the stage for OpenAI's potential future as a publicly traded entity.

Additionally, OpenAI has agreed to procure $250 billion worth of Azure cloud computing services from Microsoft. In return, Microsoft will relinquish its right of first refusal on OpenAI's computing services, a significant shift from previous terms which included intellectual property rights to OpenAI's advancements until either achieving artificial general intelligence or the year 2030.

(With inputs from agencies.)