Billion-euro deal: Amazon buys into Microsoft

At first glance, a billion-euro deal between Amazon and Microsoft sounds like a rumor of dubious veracity. Amazon and Microsoft are currently the biggest competitors in the field of cloud computing. So it would be inconceivable for one company to buy from the other - or would it? Amazon apparently intends to do just that and doesn't just want to spend small change.

Amazon makes billion-dollar deal with Microsoft for the 365 package

A report from Businessinsider, which refers to internal documents, states that Amazon wants to become a Microsoft customer. To be precise, Amazon has already been a Microsoft customer in the past. However, the two technology giants are now in direct competition in the cloud computing market and are fighting for supremacy.

Amazon has a market share of just under 30% with AWS, ahead of Microsoft Azure with a market share of between 20% and 25%. However, unlike Microsoft, Amazon cannot provide Software. Via Microsoft 365, Microsoft basically offers all the programs that customers need to get all their work done. Text creation and processing in Word, spreadsheets and analyses in Excel, presentations and animations in PowerPoint, e-mail, appointment and task management in Outlook and so on.

Microsoft is therefore far ahead of Amazon in the software sector. This has now led to the billion-dollar deal, as Amazon is planning to buy Microsoft 365 licenses for around one billion US dollars over the next five years.

On closer consideration, this is not so surprising. Amazon employees need software for their work. Until now, they have been working with outdated versions of Microsoft Office. Amazon plans to use the billion-euro deal to update to the latest version.

It is reasonable to assume that Amazon was reluctant to buy both cloud competitors and is therefore only now making this update. However, the billion-euro deal is unlikely to be very difficult for them, as Amazon and Microsoft are in healthy competition with each other.

The companies are already working together in other areas, as we can see from the integration of the Amazon Web Store in Windows or Amazon Video in the Microsoft Store.

Speculation about the billion-euro deal

There is speculation in some quarters regarding the planned billion-euro deal between Amazon and Microsoft. One of the assumptions is that Amazon is planning to integrate Microsoft's services into its Amazon Web Services cloud.

Software such as Word or Excel would be a useful addition to the AWS offering. As already mentioned, this is the area in which Amazon cannot hold a candle to its competitor Microsoft. However, it is very unlikely that this will happen.

The billion-euro deal is aimed entirely at equipping Amazon with the latest software. It remains to be seen whether this will lead to subsequent deals.

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