Microsoft Extends OpenAI Partnership Until 2032

Microsoft and OpenAI have officially cemented their partnership for the long term, signing a new agreement that extends Microsoft’s rights to OpenAI’s models and technologies until 2032. This deal confirms Microsoft’s position as OpenAI’s main “frontier model partner” and strengthens their collaboration in artificial intelligence development.

Under the new agreement, Microsoft retains exclusive intellectual property (IP) rights and Azure API exclusivity until the point of Artificial General Intelligence (AGI). If OpenAI declares AGI, that declaration will be independently reviewed by a panel of experts before any changes take effect. This ensures that both transparency and safety remain central to the partnership’s evolution.

As part of the deal, OpenAI has agreed to purchase an additional $250 billion worth of Azure services, demonstrating its long-term reliance on Microsoft’s cloud infrastructure. However, Microsoft has given up its previous right of first refusal, meaning OpenAI can now collaborate with other partners to co-develop certain products.

Despite this new flexibility, OpenAI must continue running all API products built with third-party partners on Azure. Additionally, it can now offer API access to U.S. government national security clients on other clouds and release some open-weight models, further broadening its operational scope.

This updated agreement marks a shift from provisional arrangements to a formalised long-term structure. Microsoft has publicly confirmed that its investment in OpenAI equates to around a 27% stake, valued at approximately $135 billion on an as-converted diluted basis.

One of the most notable changes is the introduction of independent oversight for AGI declarations, ensuring that progress toward advanced AI systems will undergo strict evaluation. Microsoft’s IP rights will also extend to post-AGI models until 2032, but with safety guardrails in place.

For Microsoft, this partnership renewal reinforces its AI strategy. The company’s products — including Copilot, Bing AI, and its various generative AI solutions — will continue to integrate OpenAI’s latest models for the foreseeable future. This provides users with confidence that Microsoft’s AI capabilities will evolve alongside OpenAI’s most advanced technologies.

The deal also signals a deeper commercial relationship. With a $250 billion cloud services commitment, both companies are clearly scaling up their operations rather than winding them down. This level of investment highlights their shared ambition to lead in the global AI landscape.

On OpenAI’s side, the agreement grants it more freedom to collaborate with other organisations and explore additional use cases for its technology. This could mean that OpenAI-level AI capabilities may soon appear in products and services not directly linked to Microsoft.

At the same time, Microsoft retains preferred access to OpenAI’s frontier models — the most advanced iterations that power its AI innovations. This ensures that Microsoft’s AI ecosystem, from business tools to consumer-facing platforms, will remain ahead in incorporating the latest generative AI breakthroughs.

In essence, the deal locks in a decade-long collaboration that benefits both parties. Microsoft secures continued access to cutting-edge AI innovation, while OpenAI gains financial stability, cloud resources, and operational flexibility.

Industry experts view this as a major stabilising move for the AI sector, especially as competition grows among tech giants. With the new structure in place, Microsoft and OpenAI can focus on long-term development rather than short-term experimentation.

Ultimately, the partnership extension not only underscores the two companies’ mutual confidence but also provides a glimpse into the next stage of AI evolution — one built on collaboration, scalability, and accountability.