NTT Corporation and Microsoft have signed a multi-year strategic alliance. It brings together NTT global ICT platform, services and cyber security offerings with Microsoft Azure. Microsoft is also deploying its AI solutions on top of the platform. The two companies are also building a Global Digital Fabric and collaborating on a project called IOWN.
NTT has also chosen Microsoft Azure as its preferred cloud platform. This is a significant win for NTT as it is undergoing a massive digital transformation project of its own. It has merged 28 companies to create NTT Ltd. In doing so, it has been reviewing its entire application suite and rationalising it to create a flexible global applications environment.
In a statement Jun Sawada, President and CEO of NTT said: “NTT is committed to helping enterprises realize their digital transformation initiatives to help create a smarter world. We believe that the combination of the Microsoft Azure platform along with NTT’s connected infrastructure and service delivery capabilities will accelerate these efforts. Additionally, the companies will collaborate on IOWN, including areas such as all-photonics network and digital twin computing.”
NTT and Microsoft announce three key initiatives
The press release focuses on three initiatives as part of this deal. They are:
- Formation of a Global Digital Fabric: Bringing together Azure and NTT is a smart move. It gives Microsoft greater access to a single global network to base its cloud connectivity on. More importantly, that network is built on the NTT Communication (now NTT Ltd) assets. 40% of the global Internet traffic traverses it. With the deals Microsoft has for POP access with other providers, this could give it the edge over AWS and Google.
- Development of digital enterprise solutions: This benefits NTT more than Microsoft. It now has a platform on which to standardise all its cloud development including services. At the launch of NTT, Jason Goodall, CEO, made it clear one of the key targets was to focus on developing new services. It will also have a significant benefit for both NTT and Microsoft when it comes to digital cities. There are also plans to deliver cyber security solutions which raises the question of whether the two companies will deliver a joint offering extracting the best value from their SOCs.
- Co-innovation of next-generation technologies: From a future perspective this is the most exciting. NTT and Microsoft are to work together on research and development of all-photonics network and digital twin computing. This will be built on NTT’s Innovative Optical and Wireless Network (IOWN) concept. Among the benefits it offers are ultra-low latency which is essential for global cloud services. The current research also claims it will reduce power demands which is a key cost and green initiative.
Enterprise Times: What does this mean
Where to start. This is a highly significant announcement for both organisations. The fact it was made so low-key will raise eyebrows. Both companies get serious advantages out of it and there is no obvious downside.
For NTT, it will allow it to immediately take advantage of the NTT Ltd merger. With a US$5 billion budget to build new datacentres and Microsoft having just won the US JEDI contract, this might seem an interesting fit. However, any major US build out is likely to go to NTT Data rather than NTT Ltd. That said, NTT Corp still gets revenue from the deal.
In cyber security there is a lot to be explained. Will this mean a merging of teams? That would project one of the largest global security teams with SOCs in key locations. If not a merger, would they cross-sell services? For Microsoft, access to the global threat traffic that gushes out of the NTT Com network is a big benefit.
The jewel in the crown, and something that requires more clarity on, is the joint R&D work, especially around IOWN. The potential for an ultra-low latency global IP network is very real. It is also likely to appeal to a lot of very large customers and could see Microsoft take more business off of Amazon and Google as a result.