Vodafone and Microsoft announced a sweeping 10-year strategic partnership, uniting their strengths to provide scaled digital platforms to over 300 million businesses, public sector organizations, and consumers spanning Europe and Africa.

The partnership aims to revolutionize Vodafone’s customer experience by harnessing Microsoft’s generative AI and leveraging Vodafone’s leading managed IoT connectivity platform. The collaboration will extend to developing new digital and financial services, particularly focusing on small and medium-sized enterprises (SMEs) across the two continents, and restructuring Vodafone’s global data center cloud strategy.

As part of this strategic alliance, Vodafone will invest $1.5 billion over the next decade in cloud and customer-focused AI services developed in tandem with Microsoft. In return, Microsoft will utilize Vodafone’s fixed and mobile connectivity services.

Margherita Della Valle, Vodafone Group chief executive, emphasized the significance of this commitment, stating, “Vodafone has made 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.”

Microsoft, expressing enthusiasm for the collaboration, highlighted the transformative potential of the partnership in unlocking opportunities globally. Satya Nadella, chairman and CEO of Microsoft, stated, “This new generation of AI will unlock massive new opportunities for every organization and every industry around the world. We are delighted that together with Vodafone we will apply the latest cloud and AI technology to enhance the customer experience of hundreds of millions of people and businesses across Africa and Europe, build new products and services, and accelerate the company’s transition to the cloud.”

The collaboration focuses on five key areas:

Generative AI: Leveraging Microsoft Azure OpenAI, the partnership aims to deliver real-time, proactive, and hyper-personalized experiences across all Vodafone customer touchpoints. Employees will benefit from Microsoft Copilot’s AI capabilities, transforming working practices and boosting productivity.

Scaling IoT: Microsoft will invest in Vodafone’s global IoT-managed connectivity platform, connecting 175 million devices worldwide. Vodafone aims to integrate into the Azure ecosystem, making the IoT platform available to a vast developer and third-party community.

Africa Digital Acceleration: The partnership will scale M-Pesa, Africa’s largest fintech platform, on Azure, launching new cloud-native applications. A purpose-led program seeks to impact 100 million consumers and 1 million SMEs across Africa, promoting digital literacy, skills development, and offering digital services.

Enterprise Growth: Vodafone commits to distributing Microsoft services, reinforcing its position as Europe’s leading platform for business. This includes deploying Microsoft’s cloud-based services for business customers, supporting SMEs across Europe.

Cloud Transformation: Vodafone will expedite its cloud transformation by modernizing data centers on Microsoft Azure. This move enhances responsiveness to customers, simplifies operations, reduces costs, and aligns with Vodafone’s sustainable business strategy.