OpenAI seeks to remove “AGI clause” in Microsoft deal to go full-for-profit

OpenAI is reportedly in talks to amend its agreement with Microsoft, potentially removing a clause that limits Microsoft’s access to OpenAI’s most advanced AI models if artificial general intelligence (AGI) is developed, according to a report from the Financial Times. This development follows OpenAI CEO Sam Altman’s confident prediction last year that the company could achieve AGI by 2025

OpenAI’s current agreement with Microsoft includes a clause that revokes Microsoft’s access to AGI-related technology if AGI is developed. OpenAI defines AGI as a system that surpasses human capabilities in most economically valuable tasks. This clause was introduced to keep AGI under the oversight of OpenAI’s non-profit board, aiming to prevent commercial exploitation. Removing this clause would strip away these protections, potentially opening the door for broader commercial use of the technology.

“OpenAI is in discussions to ditch a provision that shuts Microsoft out of its most advanced models when the start-up achieves “artificial general intelligence”, as it seeks to unlock billions of dollars of future investment,” The Financial Times reported.

“Under current terms, when OpenAI creates AGI — defined as a “highly autonomous system that outperforms humans at most economically valuable work” — Microsoft’s access to such a technology would be void. The OpenAI board would determine when AGI is achieved.”

Removing this restriction could pave the way for continued investments from Microsoft, which has already poured over $13 billion into OpenAI’s projects.

The report also comes just a few days after xAI founder Elon Musk sought to block OpenAI’s transition to a fully for-profit business amid ongoing antitrust allegations.

Shift to a For-Profit Model

In tandem with these discussions, OpenAI is also planning a significant organizational change. The company, which started as a non-profit, is looking to transition into a public benefit corporation. This move is aimed at attracting additional funding needed to support the development of advanced AI systems. However, this shift has sparked criticism, including from Elon Musk, a co-founder of OpenAI, who has filed a lawsuit to oppose the transition. Musk argues that the shift conflicts with OpenAI’s original mission to prioritize public benefit.

Court filings showed that Musk has requested a preliminary injunction to halt OpenAI’s plans for restructuring. The legal maneuver targets OpenAI, Sam Altman, Microsoft, and several former board members, alleging improper handling of competitive information and violations of the company’s founding non-profit principles.

Balancing Mission and Investments

These discussions underscore OpenAI’s attempt to strike a balance between its foundational goals and the substantial financial resources required to develop cutting-edge AI. The company’s board retains the authority to determine when AGI has been achieved, as noted on OpenAI’s website. The clause ensuring AGI remains outside commercial agreements is part of this governance.

“AGI is explicitly carved out of all commercial and IP licensing agreements,” according to OpenAI’s website.

Progress and Pushback

OpenAI recently closed a $6.6 billion funding round, valuing the company at $157 billion, as it pushes forward with ambitious AI projects. Meanwhile, the talks with Microsoft reflect a broader effort to align investor expectations with the company’s evolving strategies. Both Microsoft and OpenAI have not provided comments on the ongoing discussions.

While the conversations around the clause and organizational restructuring continue, no final decisions have been made. These developments highlight the complexities of navigating rapid advancements in AI while maintaining a commitment to ethical oversight.