"The restructuring deal caps more than 18 months of management turmoil and negotiation, unconvincing regulatory saber-rattling, and legal challenges. Under the new structure, Microsoft will own roughly 27 percent of OpenAI Group PBC, a share worth about $135 billion given current starry-eyed market assumptions. That's roughly a 10x return on Microsoft's $13.8 billion investment in OpenAI. Markets now value the AI upstart at about $500 billion, despite it never producing a profit."
"Microsoft will retain its position as OpenAI's "designated frontier model partner" and will have exclusive IP rights (excluding OpenAI's non-existent but touted consumer hardware) and Azure API exclusivity until OpenAI is deemed to have achieved Artificial General Intelligence (AGI). AGI, as defined by OpenAI, refers to "highly autonomous systems that outperform humans at most economically valuable work." Per the terms of OpenAI's corporate transfiguration, "Once AGI is declared by OpenAI, that declaration will now be verified by an independent expert panel.""
OpenAI agreed with Microsoft to form a public benefit corporation and recapitalize, making the company more attractive to investors. Microsoft will own roughly 27 percent of OpenAI Group PBC, a stake valued at about $135 billion under current market assumptions, representing roughly a 10x return on its original $13.8 billion investment. Markets value OpenAI at about $500 billion despite no profits. OpenAI committed to spend $250 billion on Azure cloud services but can sell API services to US national security customers without Azure requirements and Microsoft lost first-refusal rights for compute jobs.
Read at Theregister
Unable to calculate read time
Collection
[
|
...
]