Microsoft gets into 5G race with Azure cloud for telecom operators

Microsoft holds device-launching event in Barcelona ahead of the 2019 Mobile World Congress

By Supantha Mukherjee

(Reuters) – Microsoft Corp <MSFT.O> unveiled a new cloud platform on Monday aimed at enabling telecom operators to build 5G networks faster, reduce costs and sell customised services to business clients.

After banning China’s Huawei from its telecom network, the U.S. government has been pushing big American companies such as Microsoft to get more involved with 5G – a technology which promises to enable everything from self-driving cars to remote surgery and more automated manufacturing.

The new platform will be on Azure, Microsoft’s flagship cloud computing business, and the company says it will reduce infrastructure costs, give flexibility to add services on demand and use artificial intelligence to automate operations.

Yousef Khalidi, corporate vice president for Azure Networking, told Reuters that it could cut costs by 30%-40% in some cases.

The developer of Windows and Office software entered the 5G arena after its acquisition of cloud networking companies Affirmed Networks and Metaswitch earlier this year.

“The telco DNA was obtained through those acquisitions and we went from a small number of engineers in this space to literally hundreds of engineers,” said Khalidi. “On the other hand, the foundational pieces, including edge compute, we have had in a pipeline for many years.”

The company has already partnered with companies ranging from telecom operators such as Verizon <VZ.N> and AT&T <T.N> to network equipment firms such as Samsung <005930.KS> and Mavenir to either use or sell the new platform to clients.

Microsoft’s move will increase competition for existing 5G service vendors like Nokia <NOKIA.HE> and Ericsson <ERICb.ST>, said CCS Insight analyst Nicholas McQuire.

(Reporting by Supantha Mukherjee in Stockholm; Editing by Susan Fenton)