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Microsoft Scores Five-Year Cloud Services Deal With Retailer Gap

Gap will rely on Microsoft Azure and other cloud services as the foundation for a digital transformation effort across all of its brands.

Microsoft's cloud business scored a big win Friday to supply Azure and Microsoft 365 services to San Francisco-based clothing retailer Gap, which will use the Microsoft cloud technologies as part of a company-wide digital transformation initiative.

Gap's decision to embrace Microsoft is seen as a case of another major retailer shunning Amazon Web Services because retailers see Amazon as a major competitor.

Under the five-year deal, Gap will adopt Microsoft Azure as its primary cloud service platform for a broad range of e-commerce, inventory management and workforce operations. The cloud system will support Gap's online retail operations and more than 3,100 company-operated stores and the retailer will migrate hundreds of applications to the cloud platform, Microsoft said.

[Related: Microsoft CEO Nadella: Azure Is ‘Only Hyperscale Cloud That Extends To The Edge’]

Gap will also implement Microsoft 365 services, including the Office 365 personal productivity application set, Windows 10, the Power BI business analytics software, and the Enterprise Mobility and Enterprise Security suites.

The Microsoft software and cloud services will underpin a broad digital transformation effort that Gap is undertaking across all of its brands including Gap, Old Navy, Banana Republic, Athleta, Hill City and Intermix, Microsoft said. Initially the project will focus on moving key inventory, store and website systems to Azure.

Microsoft Azure will also be the foundation for Gap's DevOps model for developing, testing and deploying new applications. Gap employees will use Microsoft 365 applications globally to communicate, collaborate and share insights, Microsoft said.

"As we grow our value and active business and accelerate online and mobile, the ability to scale our technology in a secure environment to accommodate this growth is critical," said Sally Gilligan, Gap's chief information officer, in a statement. "The Microsoft Azure platform provides our teams the ability to deliver innovative and personalized capabilities for our customers with speed supported by a strong depth of technology expertise from the Microsoft team."

Adopting Microsoft cloud services will allow Gap to apply advanced analytics and machine learning to understand its customers across all its retail channels and provide personalized merchandising and marketing services for all of the retailer's brands, the company said.

The monetary value of the deal was not disclosed.

The deal with Gap is seen as a big win for Microsoft against cloud rival AWS. It also continues a trend of major retailers choosing cloud service providers other than Amazon: Redmond, Wash.-based Microsoft announced a significant cloud contract with Walmart earlier this year and Google counts Best Buy and Home Depot among its cloud service customers, according to a CNBC story.

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