Microsoft is getting ready to bring on Amazon in a $1 billion deal that will redraw the competitive landscape in cloud computing.
Amazon has signed up for just over 1.5 million license seats for Microsoft 365, the tech giant’s cloud-based productivity suite. More than 500,000 of those seats will be a higher tier of Microsoft 365 for corporate workers, with 1 million seats for frontline staff.
The five-year deal marks a reset in Amazon and Microsoft’s crosstown rivalry. Amazon Web Services, which remains the dominant cloud provider, competes fiercely with Microsoft Azure and had previously stayed off of Microsoft’s cloud.
And it’s a big win for Microsoft. When Insider first reported details of the deal, Microsoft’s stock popped. Since then, Microsoft has reported strong growth for Azure, with cloud-services sales up 29% year on year, versus a 12% gain at AWS. |