Microsoft gains AGI autonomy, ends OpenAI restriction

Microsoft’s AI chief, Mustafa Suleyman, revealed that a contractual clause had barred the company from independently developing its own artificial general intelligence (AGI) systems for several years.

The agreement with OpenAI had reportedly prevented Microsoft from pursuing AGI until 2030. The recent removal of this restriction marks a significant shift in Microsoft's AI direction.

The older agreement forced Microsoft to rely heavily on OpenAI’s frontier models.

Microsoft focused instead on providing compute, refining OpenAI models, and developing only smaller, in-house models.

Suleyman emphasized the need for full autonomy to lead the next era of AI development. "Microsoft needs to be self-sufficient in AI," he stated, stressing the necessity of training frontier models using the company's own data and compute.

The renegotiated partnership grants Microsoft the freedom to pursue AGI alone or with outside partners. This shift has led to the formation of Microsoft AI Superintelligence, a new internal division.

The new division is tasked with building frontier-grade research capabilities.

It will focus on solving hard problems like continual learning and transfer learning, pushing AI closer to human-like adaptation.

Microsoft is now positioning itself as a direct competitor to other major players, including OpenAI, Anthropic, Google, Meta, and xAI, a departure from its previous role as largely an OpenAI backer. However, Suleyman noted the company will maintain a practical, flexible approach, deploying the best available models—including open-source, OpenAI, Anthropic’s Claude, or its own MAI systems.

Investment and Governance This strategic pivot is supported by significant infrastructure investments:

Building new AI chip clusters.

Expanding the partnership with Nvidia.

Accelerating development of its own silicon to reduce external dependence.

To manage the risks of more capable systems, Microsoft appointed Trevor Callaghan as VP of Responsible AI to strengthen governance and safety.

Suleyman views this moment as pivotal, believing Microsoft's vast product ecosystem and revenue position it well to integrate AI agents across its stack to reshape productivity and automate work.