AT&T partners with IBM and Microsoft, focuses on network capabilities

Earlier this year, AT&T finalized a deal to divest itself of its 31 data centers for $1.1 billion. Now that it has dumped its data center business, the company partnering with two of the largest providers of them: Microsoft and IBM.

IBM and AT&T this week announced a multi-year strategic alliance where AT&T’s network and IBM Cloud will link up to provide software-defined network (SDN) services, including giving IBM Cloud access to AT&T’s 5G network. 

In return, IBM will make AT&T its primary provider of 5G, edge computing, and internet of things (IoT) services and help manage AT&T’s entire infrastructure footprint, including third-party cloud services, using Red Hat’s open-source tools to manage the network. This isn’t really new, as AT&T was using Red Hat Enterprise Linux (RHEL) for some time.

As for Microsoft, Azure will become the preferred cloud provider for AT&T’s non-network applications. This means non-network infrastructure applications will transition to Microsoft Azure, and “much” of AT&T’s workforce will move to Microsoft 365 cloud-based collaboration.

AT&T focuses on core network capabilities

AT&T has the goal of becoming a “public-cloud first” company and plans to migrate most non-network workloads to the public cloud by 2024. Like so many other firms, AT&T wants to get out of running its own data centers to focus on core network capabilities. Microsoft is the logical choice, since it has Office 365 and there is no viable alternative.

As with the IBM deal, AT&T and Microsoft have many more future plans and ambitions to work out, and that includes 5G and edge computing networks.

“AT&T is at the forefront of defining how advances in technology, including 5G and edge computing, will transform every aspect of work and life,” Microsoft CEO Satya Nadella said in a statement. “The world’s leading companies run on our cloud, and we are delighted that AT&T chose Microsoft to accelerate its innovation.”

The deal isn’t exactly a first. Verizon dumped its data centers a few years back to Equinix and last year signed a deal with Amazon Web Services (AWS) to make AWS its preferred public cloud provider with the promise of migrating more 1,000 business-critical applications and back-end systems to AWS as part of the deal.