A small clause tucked inside OpenAI’s contract with Microsoft has stirred up a storm. This isn’t the first time we’ve seen tech partnerships hit a snag, but this one’s a doozy. If OpenAI claims it’s cracked artificial general intelligence (AGI), Microsoft’s access to future tech gets clipped. Microsoft, having sunk over $13 billion into OpenAI, isn’t too keen on that and might just walk away. Seen this kind of corporate poker before? Here’s what this really means: Microsoft wants assurances or it’s game over.
Tensions flared late last year over a research paper within OpenAI, “Five Levels of General AI Capabilities.” The paper laid out stages of AI development, potentially complicating OpenAI’s ability to claim AGI. These debates aren’t just academic; they’re bargaining chips. OpenAI’s spokesperson said they’re developing empirical methods to assess AGI but let’s cut through the jargon — it’s about controlling the narrative.
OpenAI’s structure excludes AGI from IP licenses with Microsoft. They define AGI as a system surpassing human performance in economically valuable tasks. In simple terms, it’s their golden goose, and they’re not sharing.
The companies are renegotiating their deal as OpenAI eyes restructuring. Microsoft wants access to OpenAI’s models even if AGI is declared before 2030. The twist? A source says Microsoft doesn’t buy that OpenAI will hit AGI by then, but the clause is OpenAI’s ace in the hole. If they do claim AGI, Microsoft’s cut off. Microsoft, bound by contract, can’t pursue AGI independently using OpenAI’s IP. It’s a tangled web of corporate chess.
The Wall Street Journal reports OpenAI considered the clause based on an AI coding agent. Things have heated up enough that OpenAI mulled calling out Microsoft for anticompetitive behavior. That’s standard playbook stuff when negotiations sour.
A source claims OpenAI is close to AGI, with Sam Altman expecting it during Trump’s current term. Take that with a grain of salt — predictions in tech are often optimistic. OpenAI’s board has the power to declare AGI by their definition, cutting Microsoft off cold, but the contract’s “sufficient AGI” clause, added in 2023, ties Microsoft’s hands until it’s profitable.
OpenAI’s “Five Levels” paper, previously reported by Bloomberg, was shared with investors but remains a work in progress. The paper outlines a five-step scale for AI advancement, stopping short of predicting timelines but warning of societal impacts and risks. Altman’s optimistic about reaching Level 3 soon, but let’s not get swept up in the hype. Tech timelines are notoriously slippery.
An internal presentation of the research last July was well received, yet the paper’s release was delayed, supposedly not to ruffle Microsoft’s feathers. Officially, OpenAI says it wasn’t to protect the partnership, but the timing is suspect.
Altman downplayed the AGI definition debate, calling it a moving target. That’s the reality — AGI’s definition shifts with each breakthrough. In tech, today’s AGI buzzword is tomorrow’s punchline. The real focus should be on the tangible economic impacts and readiness for the next shift, not just chasing theoretical milestones.