TLDR: OpenAI was reportedly in discussions to remove a clause in its Microsoft agreement that limited access to advanced AI models upon achieving Artificial General Intelligence (AGI), signaling a potential full for-profit shift. However, the company later abandoned plans for a complete transition to a for-profit entity, opting instead for a revised structure that maintains non-profit oversight while allowing for conventional equity stakes. Concurrently, OpenAI CEO Sam Altman has recently stated that the term AGI is becoming less relevant, reflecting a market shift towards specialized AI applications over undefined breakthrough promises.
OpenAI, a leading artificial intelligence research organization, has been at the center of discussions regarding its corporate structure and the evolving definition of Artificial General Intelligence (AGI). Reports indicated that the company was in talks to amend its agreement with Microsoft, potentially removing a crucial clause that would limit Microsoft’s access to OpenAI’s most advanced AI models once AGI was achieved. This move was widely interpreted as a strategic step towards a full for-profit shift, designed to unlock billions of dollars in future investment. The ‘AGI clause’ was initially put in place to ensure that AGI, defined by OpenAI as ‘a highly autonomous system that outperforms humans at most economically valuable work,’ would remain under the oversight of OpenAI’s non-profit board, preventing purely commercial exploitation.
This potential shift drew significant criticism from various quarters, including AI experts and former OpenAI staffers. A coalition of these individuals urged regulators in California and Delaware to intervene, arguing that such a transition would deviate from the company’s foundational non-profit mission to prioritize public benefit over profit. They contended that dismantling the original structure, which included an independent board majority and investor return caps, would remove crucial safeguards designed to ensure AI serves humanity rather than just shareholders.
However, by May 2025, OpenAI announced a significant change in its corporate strategy, abandoning its previous plans for a complete transition to a fully for-profit firm. This decision followed public backlash and a lawsuit filed by co-founder Elon Musk, who has been a vocal critic of the company’s direction. Instead of a full for-profit conversion, OpenAI opted for a revised structure where its for-profit subsidiary would issue conventional equity stakes, rather than profit-sharing entitlements, while the non-profit entity would retain ultimate control. This restructuring aimed to balance the need for substantial investment with the company’s original mission.
Adding another layer to the narrative, OpenAI CEO Sam Altman, in August 2025, expressed a changing perspective on the term ‘Artificial General Intelligence.’ Altman stated that AGI is becoming ‘less relevant’ and ‘not a super useful term’ as rapid advancements in AI make the concept harder to define. He noted that AGI, commonly described as AI capable of performing any intellectual task a human can, now suffers from multiple, inconsistent definitions. Altman suggested that focusing on incremental improvements in AI models might be more beneficial than chasing an ill-defined AGI.
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This sentiment aligns with a broader market shift, where investor focus is reportedly moving away from abstract AGI promises towards specialized AI applications that deliver measurable automation value in specific business functions. The current AI agent market, valued at approximately $5-5.3 billion, demonstrates that specialized applications are already generating substantial revenue, unlike AGI, which remains a future promise. Industry analysis indicates a projected annual growth of 45% for specialized AI agents, reaching $216.8 billion by 2035, and automating 50% of tasks in sectors like HR, customer service, and sales. This suggests that while AGI terminology has served as a powerful fundraising tool, the practical emphasis is now on deliverable AI products.
