OpenAI’s Microsoft Deal; Ellison’s Risky Business

We got big news this afternoon from the folks at OpenAI and Microsoft: They are close to a peace deal. Yes, after nearly a year of talks over changes to their partnership, the companies announced they had signed a “non-binding memorandum of understanding for the next phase of our partnership.” Contractual terms now have to be finalized. Hmmm. That sounds like a deal you have when you don’t really have a deal. (More coverage is here).

The two companies have been at odds for a while, over all manner of things, as we reported here, here and here. A key issue is that OpenAI wants to convert its for-profit business into a company whose investors own shares, which would make it easier for the ChatGPT creator to raise money and eventually go public. (Raising money is something OpenAI needs to do a lot of, as this story explains). Today’s statement was bereft of details indicating whether the two companies have resolved any of the contentious issues that have divided them (like what happens with Microsoft’s right to share in OpenAI’s revenue).