The partnership between Microsoft and OpenAI for AGI has come to an end.

OpenAI and Microsoft’s evolving partnership has taken another turn, with a significant change: the removal of the artificial general intelligence (AGI) clause that has shaped their collaboration for years.

On Monday, Microsoft unveiled several key updates to its long-standing agreement with OpenAI. While Microsoft will continue to be OpenAI’s primary cloud partner, ensuring that OpenAI products launch first on Azure—unless Microsoft opts out of supporting the necessary capabilities—OpenAI is now free to offer its products to customers across any cloud platform. This shift allows OpenAI to target enterprise clients more aggressively as it gears up for a potential public offering, opening avenues to collaborate with competitors like Amazon or Google and easing the constraints that have led to tensions with Microsoft. Microsoft will still receive a share of revenue from these new partnerships.

In a noteworthy development, the companies have eliminated the AGI clause, which outlined specific conditions if either party achieved AGI—a term that generally refers to AI systems that match or exceed human intelligence across various tasks.

This change affects the revenue-sharing agreement, which was originally set to remain in effect until AGI was declared. Now, revenue-sharing payments from OpenAI to Microsoft will only continue through 2030. While these payments will maintain the same percentage, they will be capped, rather than ongoing indefinitely. Additionally, these payments will conclude independently of OpenAI’s technological advancements, including any potential AGI milestone.

This marks the second time the clause has been renegotiated. Following OpenAI’s controversial shift to a for-profit model last October, it required Microsoft’s approval, leading to a new agreement. Previously, Microsoft would have lost access to OpenAI’s technology upon the declaration of AGI. However, the updated terms extend Microsoft’s intellectual property rights for OpenAI’s models and products through 2032, even after an independent panel might declare AGI has been achieved.

Now, there’s no independent panel or conditional language regarding the declaration of AGI, meaning OpenAI may not need to officially announce reaching that milestone. Microsoft’s license to OpenAI’s models and products is now non-exclusive, allowing other competitors to enter the fray.

Microsoft previously held about 27 percent ownership in the public benefit corporation. The new terms confirm that Microsoft remains a significant shareholder in OpenAI’s growth, though they do not specify any changes to its ownership stake.

With pressure mounting for OpenAI to become profitable, the company and its rivals have been rapidly spending investor funds to secure more computing power and pursue AGI. OpenAI has committed to focusing on enterprise solutions and coding as key revenue sources, systematically cutting back on less critical projects like Sora and the planned features for ChatGPT. This new agreement with Microsoft is another strategic move in that direction.