Sam Altman Says GPT-5 Coming “This Summer,” As OpenAI Starts Eating Palantir’s Lunch And Grows Increasingly Territorial With Microsoft

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As the poster child of the ongoing AI gold rush, OpenAI is not only growing increasingly assertive in its dealings with Microsoft, while expanding into the traditional turf of the other major AI player, Palantir, but is also now preparing to unlock another major frenzy cycle by releasing its next big model, the GPT-5, this summer.

For the benefit of those who might not be aware, OpenAI has a unique organizational structure, where its non-profit arm retains operational control over its for-profit arm.

The AI-focused startup also has a creative investment structure with Microsoft, where the latter has provided $13 billion in funding in return for a 49 percent share in the former’s future profit, albeit capped on a cumulative basis. Microsoft also gets 20 percent of OpenAI’s revenue and retains the right to use its intellectual property through 2030.

However, in what is a testament to its renewed confidence, OpenAI is now pressurizing Microsoft to re-negotiate the terms of their mutual agreement, as per a report by The Information. Specifically, OpenAI wants Microsoft to accept a 33 percent stake in its for-profit arm and give up its claims to the AI startup’s revenue, future profits, and IP. This restructuring, if it goes ahead, will pave the way for OpenAI to go public.

In another related development, OpenAI is now reportedly undercutting Microsoft by discounting enterprise subscriptions to its suite of bundled AI products. Specifically, OpenAI is now discounting ChatGPT Enterprise by 10 to 20 percent for customers who buy additional products.

This development comes as xAI, a major competitor to OpenAI, is reportedly burning $1 billion in cash per month and, therefore, is trying to raise $9.3 billion in new funding, according to Bloomberg. xAI expects just $500 million in revenue this year.

Meanwhile, the US Chief Digital and Artificial Intelligence Office (CDAO) has now awarded OpenAI a $200 million, 1-year contract for prototype AI solutions. As noted by William Blair analyst Louie DiPalma, this marks OpenAI’s first significant contract from the Department of Defense, where Palantir has usually reigned supreme. Also, on a per-year basis, this marks one of the largest DoD contracts ever. For context, Palantir’s largest overall contract – the Maven Smart System program – has an annual recurring revenue (ARR) run-rate of $210 million.

Finally, do note that OpenAI’s CEO, Sam Altman has just hosted the company’s first podcast. In a notable tidbit, Altman has announced that GPT-5 is coming this summer.

When asked about the release timeline of the GPT-5 model, Altman said, “probably sometime this summer” but “I don’t know exactly when.”