In the last few weeks OpenAI has quietly unveiled a major change to its revenue-sharing plan with Microsoft and other commercial partners. Today, OpenAI gives Microsoft 20% of its top-line revenue as part of their current deal. The company plans to bring this share of revenue down to 10% by the end of the decade. The Information was first to report this development. It foreshadows OpenAI’s strategic pivot, as the company adjusts to a rapidly changing artificial intelligence world.
This week, OpenAI announced just such a plan, which includes the conversion of its for-profit subsidiary into a new public benefit corporation (PBC). This shift connects business practices more directly to society’s interests. All of that while ensuring that the original commitment to innovation in AI technology remains strong. Further, OpenAI’s nonprofit division will still be in charge of the for-profit arm. This ensures that its original and most important mission remains protected.
OpenAI is trying to strengthen alliances with its partners by shifting its revenue-sharing model. This new step goes a long way to make sure this fragile agency continues to keep its financial house in order. OpenAI is eliminating the percentage of revenue that gets shared with Microsoft and other partners. This frees them up to focus more of their resources on creating and developing new tools. This strategic realignment is meant to strengthen NAT’s competitive advantage in the growing and fast-moving AI industry.
OpenAI’s recent transition from a nonprofit organization to a public benefit corporation is just the latest move in its rapid expansion and change. By taking this approach, OpenAI believes it can maximize profit while addressing the broader social impact of artificial intelligence. Its leadership has a clear desire to put ethics and long-term societal benefits at the center of their decisions, alongside their business goals.
As OpenAI moves forward with these changes, it will be looking at industry experts and stakeholders over its shoulder. This new revenue-sharing model has the potential to re-shape OpenAI’s future. It might shape the ways that technology companies work together or don’t in the AI ecosystem.
