The British telecoms operator will invest $1.5 billion in customer-facing AI technologies, based on Azure OpenAI and Copilot, and replace physical data centers with cheaper and scalable Azure cloud services.
On Microsoft's side, the group became an equity investor in the IoT platform managed by Vodafone - expected to be spun off into an independent business next April - as well as supporting the expansion of the carrier's mobile financial platform in Africa.
Supporting businesses to go digital is seen by Vodafone as an opportunity to boost profits in the already saturated telecoms industry. The operator’s CEO Margherita Della Valle estimates the market could be worth up to 140 billion euros.
The deal, signed with Microsoft Chairman and CEO Satya Nadella, will “accelerate the digital transformation of enterprise customers, especially small and medium-sized businesses,” she said.
Vodafone CFO Luka Mucic said Microsoft's leadership in AI, reinforced by the OpenAI partnership, will transform Vodafone's customer services.
Vodafone plans to use the AI-powered TOBi chatbot provided by Microsoft, which will be able to respond to queries more intelligently and consistently.
The company says the technology will help carrier customer service agents improve productivity and conversation quality rather than completely replacing employees with AI.
Meanwhile, Microsoft wants to leverage Vodafone's reach in IoT and financial services.
Vodafone's mobile money platform M-PESA, which operates in Kenya, Tanzania, South Africa and other African countries, shares Microsoft's goals in the region, such as building digital literacy.
(According to Reuters)
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