Microsoft to offer Azure telecoms after buying AT&T’s network cloud

Jason Zander Microsoft Azure.jpg

AT&T is selling the network cloud on which it runs its 186 million mobile customers to Microsoft, for an undisclosed price.

The two companies say this is a “strategic alliance” under which all of AT&T’s mobile network traffic will now be managed using Microsoft Azure. But the technology will be available to other operators too.

Andre Fuetsch, AT&T’s CTO, said: “Microsoft’s decision to acquire these assets is a testament to AT&T’s leadership in network virtualization, culture of innovation, and realization of a telco-grade cloud stack.”

The deal means Microsoft will gain access to AT&T’s intellectual property and technical expertise to grow its own telecom offering, which it calls Azure for Operators. “This move brings real-world production 5G workloads to Azure for Operators,” said Microsoft.

Azure executive VP Jason Zander (pictured) said: “Through our collaboration with AT&T, Microsoft will 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.”

The move comes in a week that has seen a number of significant cloud announcements from the mobile industry. Yesterday Orange announced Pikeo, an experimental cloud-based network that it hopes will eventually provide what it calls “ambient connectivity”. Swisscom also said it was building a cloud-native 5G network using Amazon Web Services (AWS). 

And the day before Google Cloud and Ericsson said they have partnered to help communications service providers deliver new capabilities at the edge, using 5G and edge cloud solutions.

In the Microsoft deal, AT&T’s 5G core, the software at the heart of the 5G network that connects mobile users and IoT devices with internet and other services, will move to Azure.

AT&T developed its cloud solution when it launched 5G in 2018 and the unit will be transferred to Microsoft. “The network cloud platform engineering team will receive offers to join Microsoft,” said the companies.

Fuetsch said: “AT&T has one of the world’s most powerful global backbone networks serving hundreds of millions of subscribers. Our network cloud team has proved that running a network in the cloud drives speed, security, cost improvements and innovation.”

Microsoft confirmed that it will make the platform applicable to other carriers through Azure for Operators and invest in an ecosystem to enable simpler and faster transition of network workloads to cloud. Zander said: “With Azure, operators can provide a more flexible and scalable service model, save infrastructure cost, and use AI to automate operations and differentiate customer offerings.”

Microsoft added that it will acquire AT&T engineering and lifecycle management software used to develop and deploy a carrier-grade cloud that runs containerised or virtualised network services. It pointed out that it already has Affirmed Networks and Metaswitch Networks following acquisitions last year. These will “enable operators to run a secure telecom network in the cloud”, it said.