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OpenAI Considers Antitrust Complaint As Talks With Microsoft Reach Impasse

The standoff threatens OpenAI’s planned conversion to a public-benefit corporation by freezing approval of its restructured equity and profit-sharing terms.

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Photo illustration: Brendan Lynch/Axios. Photos: Hollie Adams/Bloomberg via Getty Images and Chip Somodevilla/Getty Images
Photo: Justin Sullivan (Getty Images)
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Overview

  • OpenAI executives have discussed filing a federal antitrust complaint against Microsoft, alleging the company is using its cloud dominance to suppress competition and seeking a regulatory review of their contract agreement.
  • Microsoft’s sign-off is required for OpenAI to convert its for-profit arm into a Delaware-based public-benefit corporation, a restructuring investors expect to finalize by year-end.
  • In negotiations to amend their 2019 partnership, OpenAI has offered Microsoft a fixed 33% stake in the restructured entity in exchange for relinquishing future profit shares, but the proposal has yet to secure agreement.
  • OpenAI is pushing to eliminate Microsoft’s exclusive hosting rights for its AI models and is arranging Google Cloud services to diversify its computing infrastructure.
  • A key point of contention is Microsoft’s access to intellectual property from OpenAI’s recent $3 billion acquisition of coding startup Windsurf, which OpenAI fears could advantage GitHub Copilot.