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OpenAI and Microsoft Forge New Agreement to Transform Corporate Structure

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OpenAI reaches new agreement with Microsoft to change its corporate structure

OpenAI has entered a tentative agreement with Microsoft, granting its nonprofit organization a $100 billion equity stake in the for-profit entity that develops AI technologies like ChatGPT. This partnership marks a significant evolution in their collaboration, announced alongside other key changes amid scrutiny from regulators regarding OpenAI’s corporate structure. Founded as a nonprofit in 2015, OpenAI’s board oversees its for-profit subsidiary, which has raised concerns about the implications of artificial intelligence. California Attorney General Rob Bonta is investigating OpenAI’s restructuring and emphasizes the importance of safety in alignment with its nonprofit mission. Microsoft initially invested $1 billion in 2019 and continues to leverage OpenAI’s technology to enhance its own products. There is ongoing uncertainty regarding the finalization of contractual terms between the two companies, amidst legal challenges from co-founder Elon Musk, who seeks to maintain the nonprofit’s control over the mission-driven development of AI.

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