What you need to know
- Microsoft and Amazon are reportedly in the midst of a megadeal summing up to approximately $1 billion.
- The deal will help Amazon acquire 550,000 Microsoft 365 E5 licenses for its corporate workers, alongside one million Microsoft 365 F5 licenses for its frontline employees.
- Amazon employees already use traditional, on-premises Microsoft Office software, but the company is now gearing up to transition to cloud-based productivity tools.
- The transition is scheduled to start this month, and it is expected to be complete b by early 2024.
- According to a source, Amazon was reluctant to leverage Microsoft's cloud computing services because it didn't want to store its data on the competitor's cloud.
This past month, we learned that Amazon and Microsoft are in the midst of a "megadeal" that would see the former part with approximately $1 billion within a span of five years to secure one million Microsoft 365 licenses for its corporate employees and workers with frontline roles.
Amazon already leverages traditional, on-premises Microsoft Office software, but it now seems the company is ready to transition to cloud-based productivity tools. According to a spot by Business Insider, the transition is scheduled to begin this month through to early 2024.
The initial report didn't detail the specifics of the deal, aside from mentioning that it was for one million Microsoft 365 licenses. But new details pertaining to the deal are emerging. According to people with close affiliations to the deal, Amazon will get 550,000 Microsoft 365 E5 licenses for its corporate workers alongside one million Microsoft 365 F5 licenses for its frontline employees.
Is this the end of a long-standing rivalry?
It's no secret that Microsoft and Amazon are great competitors, especially in the cloud space. We learned that Amazon steered clear of Microsoft cloud productivity tools because it didn't want to store its data and information on the competitor's cloud.
The company's change of heart could finally put the rivalry between both entities to rest. Microsoft has yet to confirm the deals, though a company spokesman indicated that M365 sticker prices "grossly overestimates the value of the deal."
Given the magnitude of the deal, there's a possibility that both companies came to an agreement that would see Amazon get some sort of "discount."
What are your thoughts on Amazon shifting gears and using Microsoft's cloud services? Let us know in the comments.
