AT&T and Microsoft Form Multibillion-Dollar Alliance to Collaborate on Cloud, AI, 5G, and More

AT&T also this week announced a cloud-related deal with IBM worth billions. The two agreements have different focuses, but are both vital in AT&T's ongoing effort to work with fewer, more strategic suppliers.

AT&T Communications today announced it was entering an extensive, multiyear alliance with Microsoft Corp., intended to improve people’s everyday lives. Together, the two companies will collaborate on emerging technologies that AT&T says will deliver new innovations and offerings for its customers and their communities.

The deal is estimated to be worth more than $2 billion by CNBC, which also noted that AT&T is a big win for Microsoft because of its “significant data storage and computing needs for its over 250,000 staffers.” With the agreement, most of AT&T’s employees will start using the tools and cloud-based productivity applications from Microsoft 365. And, AT&T said it plans to move its non-network infrastructure to the Microsoft Azure platform.

“Together, we will apply the power of Azure and Microsoft 365 to transform the way AT&T’s workforce collaborates and to shape the future of media and communications for people everywhere,” Microsoft’s CEO, Satya Nadella, said in a statement. Nadella also credited AT&T’s place at the forefront of transformational technology advances, including 5G and edge computing.

Microsoft will become AT&T’s “preferred cloud provider for non-network applications,” which is a key part of AT&T’s broader strategy to become a ‘public cloud first’ company.

By 2024, AT&T plans to migrate most of its non-network workloads from its data centers to the public cloud. This will enable the telecom giant to “focus on core network capabilities, accelerate innovation for its customers, and empower its workforce while optimizing costs.”

AT&T announced a second cloud-related deal this week with IBM—worth “billions” of dollars, according to CNBC—that enabled AT&T Business Solutions’ internal software applications to move to the IBM Cloud.

Though the two partnerships appear similar, they have different focus areas, according to AT&T’s director of corporate communications, Jeff Kobs. IBM is related to AT&T Business and its internal applications, while Microsoft is more about the public cloud.

“Both agreements are about accelerating innovation and driving business transformation,” he told Dallas Innovates in an email. “Both agreements are important steps in AT&T’s ongoing effort to collaborate with fewer, more strategic suppliers.”

AT&T and Microsoft collaborate beyond the cloud

AT&T and Microsoft already have joint enterprise services in networking, IoT, and blockchain, but plan to announce more later this year. The companies want to bring solutions to various areas, citing voice, collaboration and conferencing, intelligent edge and networking, IoT, public safety, and cybersecurity in a news release.

Through the newly announced strategic alliance, AT&T and Microsoft will also use edge technologies and 5G to work toward a “future of ubiquitous computing.” AT&T is credited with being the first in the country to introduce mobile 5G, and Microsoft said it will tap into that for edge-computing designing, testing, and building.

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And, when pairing 5G-enabled communication with AI-powered live voice translation, AT&T and Microsoft imagine first responders could instantaneously understand someone speaking in a different language. Last year, AT&T launched FirstNet, the first nationwide public safety communications platform dedicated to helping first responders communicate in emergencies.

But beyond the business as mutual alliance, AT&T and Microsoft said they will work on tech-enabled social impact projects. The companies will support each other’s projects, like AT&T’s Believes campaign and Microsoft’s affordable housing initiative.

“AT&T and Microsoft are among the most committed companies to fostering technology that serves people,” John Donovan, CEO of AT&T Communications, said in a statement. “By working together on common efforts around 5G, the cloud, and AI, we will accelerate the speed of innovation and impact for our customers and our communities.”

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