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January 17, 2024
Vodafone and Microsoft sign $1.5bn AI deal for 10 years

Vodafone has announced a 10-year deal with Microsoft in a bid to scale its generative AI, digital services and cloud platforms to more than 300 million businesses, public sector organizations, and consumers across Europe and Africa.

The British multinational telecommunications company said it plans to invest $1.5 billion in cloud and customer-focused AI services developed in conjunction with the tech giant, giving Microsoft access to Vodafone’s fixed and mobile connectivity services.

In exchange, Microsoft said it intends to become an equity investor in Vodafone’s managed Internet of Things (IoT) connectivity platform, which will become a separate, standalone business by April.

Vodafone reported better top-line growth in July, driven by higher prices in the UK and improvements in Germany, Italy and Spain, which marked a positive start for the new Chief Executive Margherita Della Valle’s turnaround plan.

We’ve announced a 10-year strategic partnership with @Microsoft to bring #GenerativeAI and the #Cloud to more than 300 million customers.

Read the full announcement below.

— Vodafone Group (@VodafoneGroup) January 16, 2024

Della Valle, aiming to return the company to growth, described the partnership as a “bold commitment” to the digital future of Europe and Africa. “This unique strategic partnership with Microsoft will accelerate the digital transformation of our business customers, particularly small and medium-sized companies, and step up the quality of customer experience for consumers,” she continued.

“This new generation of AI will unlock massive new opportunities for every organization and every industry around the world,” said Microsoft CEO Satya Nadella, adding that they were “delighted” by the collaboration.

According to Reuters, Vodafone’s Chief Financial Officer Luka Mucic stated that Microsoft’s expertise in AI, bolstered by its partnership with OpenAI, is set to revolutionize the telecom company’s customer services.

He said, “That’s the part that is really going to catch each and every one of our customers,” adding that a TOBi chatbot, enhanced by Microsoft’s AI technology, will offer more coherent and intelligent responses to inquiries.

Which areas will Microsoft and Vodafone collaborate in?

The companies have pinpointed five primary areas for collaboration, one of which includes using generative AI to enhance customer satisfaction. This will involve leveraging Microsoft Azure OpenAI to provide real-time, personalized experiences for Vodafone customers.

Vodafone also intends to become part of the Azure ecosystem making the IoT platform available to developers and third-party communities using open APIs. Microsoft also hopes to help further scale M-Pesa, which is the telecoms company’s mobile money service in Africa, while enhancing digital literacy.

Aside from cloud transformation, the Berkshire-based company aims to distribute Microsoft services across businesses in Europe.

Featured Image: Mike Mozart / Canva / Vodafone

The post Vodafone and Microsoft sign $1.5bn AI deal for 10 years appeared first on ReadWrite.


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