AT&T, Microsoft Team Up In Massive Cloud, 5G Deal Reportedly Worth Billions

AT&T and Microsoft on Wednesday confirmed an extensive, multi-year partnership to support each other in cloud and 5G.

The pact is valued at more than $2 billion, according to a new report from CNBC citing sources familiar with the deal. Microsoft, through a spokesperson, said that it couldn’t confirm the financial estimates reported by CNBC, but a source confirmed to CRN that the figure was accurate.

 AT&T said it plans to move most of its non-network workloads to the public cloud by 2024. Via the terms of the latest deal, AT&T Communications will move its workloads to Microsoft Azure. The two companies will also collaborate on new 5G products, the companies said.

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The latest partnership comes on the heels of AT&T's Tuesday alliance announcement with IBM. Also a multi-year deal, AT&T Business Solutions said it will migrate its internal software applications to the IBM cloud. In turn, IBM will make AT&T Business its primary provider of software-defined networking (SDN). Microsoft, like IMB, will support AT&T as the carrier works to pare down its data center operations.

 "The world's leading companies run on our cloud, and we are delighted that AT&T chose Microsoft to accelerate its innovation," said Microsoft CEO Satya Nadella in a statement. "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."

The new deal forged between AT&T and Redmond, Wash.-based Microsoft will allow the two companies to design, test, and build edge-computing capabilities by combining the global reach of Microsoft Azure with AT&T's domestic 5G capabilities. The two companies said they will bring new solutions to the market in areas such as collaboration and conferencing, intelligent edge and networking, IoT, public safety, and cybersecurity.

 "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," said John Donovan, CEO of AT&T Communications, in a statement.

Most of AT&T's 268,000 employees will also now use Microsoft 365 cloud-based productivity and collaboration tools, the Dallas-based carrier said.

AT&T and Microsoft said that in addition to their technology alliance, the two plan on collaborating on "technology-enabled approaches" to addressing social causes, such as homelessness, accessibility, and sustainability.

When asked how the new partnership would impact channel partners, an AT&T spokesperson told CRN: “This is an extensive, multi-year alliance, during which both companies will invest time and resources to deliver joint value. We’ll have more to share as our relationship expands.”