It was revealed on Thursday that Microsoft would be acquiring AT&T's Network Cloud business under a new deal that will see Azure handle the complete traffic of AT&T's 5G traffic.
In 2019, Microsoft and AT&T had announced that a $2 billion partnership was taking place that would focus on AI, 5G, as well as the varying network operations in the cloud, in what, at the time, AT&T dubbed its ‘public cloud first’ strategy of operation.
Two years later, however, AT&T has announced that it would be moving its 5G network to the Microsoft cloud, which would result in all of its traffic being managed via Microsoft Azure technologies.
AT&T’s 5G core would be the first to be shifted to the cloud, after which the rest of AT&T’sexisting network cloud would be ported to Azure over a span of the next three years.
What Do We Know About the Deal
As part of this deal, Microsoft will also be acquiring AT&T’s carrier-grade Network Cloud platform technology, with the company stating that the move would result in a reduction of its operating costs as well as allow them to leverage a wider ecosystem of software developers creating more and newer 5G solutions.
In terms of Microsoft, the move will result in the enhancement of Azure for operators offering that the company hopes to expand to telcos on a global level.
Jason Zander, the EVP of Azure at Microsoft stated that with Azure, operators will now be able to provide a more flexible and scalable service model, save infrastructure cost, and use AI to automate operations and differentiate customer offerings.
Via the company's collaboration with AT&T, Microsoft will be able to expand its telecom portfolio to support operators with a carrier-grade cloud that provides seamless experiences across Microsoft’s cloud and the operator’s network. Though, the financial terms of the deal were not revealed to the public.
This is not the first and definitely not the last of such moves, with Dish having formed a strategic 5G partnership with Amazon Web Services or AWS in April, whilst other operators like Vodafone, Deutsche Telekom, Verizon and Telefonica all engaging in discussions with the public cloud providers in different forms.
For the different kinds of large telcos, it seems but a matter of time prior to which the public cloud and outsourcing of network operations becoming too attractive.
