Microsoft is considering taking legal action against OpenAI and Amazon over a $50 billion deal. The partnership, in which Amazon Web Services becomes the exclusive third-party cloud provider for OpenAI’s enterprise platform Frontier, would violate the exclusive cloud agreement between Microsoft and OpenAI.
That is according to sources cited by the Financial Times. Frontier is designed for building and running AI agents. Last month, Amazon Web Services (AWS) and OpenAI reached an agreement under which AWS became the exclusive third-party cloud provider for Frontier. Microsoft argues that, under an agreement, all access to OpenAI models must go through Azure.
Frontier at the heart of the dispute
“We know our contract,” says a person familiar with Microsoft’s position. “We will sue them if they breach it. If Amazon and OpenAI want to take a bet on the creativity of their contractual lawyers, I would back us, not them.”
A lawsuit is not yet certain. According to the Financial Times, the parties are in talks to resolve the conflict before the launch of Frontier. In a joint statement last month, Microsoft and OpenAI confirmed that Microsoft retains the “exclusive license and access to intellectual property” regarding OpenAI models and that Azure remains the exclusive cloud provider.
Microsoft had previously threatened to halt negotiations with OpenAI regarding their multi-billion-dollar partnership. At the same time, Microsoft chose Anthropic as an alternative AI partner, while OpenAI turned to Oracle for additional cloud capacity. The AWS deal fits into this as the next step in OpenAI’s multi-cloud strategy.
Tip: OpenAI brings AI coworkers to enterprises via Frontier Alliances