Microsoft has formed what it called a long-term strategic partnership with Flipkart, the most prominent domestic e-commerce company operating in the Indian market, that is to see Flipkart initially using Microsoft Azure’s cloud infrastructure and later more advanced services such as machine learning and data analytics.
The deal is a boost for Azure, which is faces intense competition from the likes of market leader Amazon Web Services (AWS), Google Cloud Platform and others, and gives Microsoft a foothold in India’s quickly growing e-commerce market, where Amazon has pledged to invest $5 billion (£4bn) to build its business.
At an event on Monday in Bangalore, the Indian high-tech hub where Flipkart is based, Microsoft chief executive Satya Nadella – himself a native of Hyderabad, India – said he was an admirer of Flipkart’s growth from e-commerce into other areas including logistics.
“Combining Microsoft’s cloud platform and AI capabilities with Flipkart’s existing services and data assets will enable Flipkart to accelerate its digital transformation in e-commerce and deliver new customer experiences,” Nadella said in a statement released to coincide with the event.
Flipkart Group chief executive Binny Bansal said the deal would allow his company to benefit from Microsoft’s large scale and reliability in cloud services.
“This partnership allows us to leverage our combined strength and knowledge of technology, e-commerce and markets to make online shopping more relevant and enriching for customers,” he stated.
Founded in 2007 by two former Amazon.com employees, Flipkart has introduced features tailored to the local market, such as cash-on-delivery and installment-plan payments, and has expanded into related areas with own-brand products and the acquisition of start-ups in areas including online content production and and mobile payments.
Privately held Flipkart doesn’t disclose its sales figures, but reports in the Indian business press citing unnamed sources held that it has outsold Amazon’s Indian e-commerce operations since December, after falling behind Amazon for a time in the middle of 2016.
Flipkart claims to be India’s e-commerce leader.
The company currently uses in-house data centres and after initially using Azure cloud infrastructure plans to add Azure’s artificial intelligence, machine learning and analytics capabilities, including Cortana Intelligence Suite and Power BI for merchandising, advertising, marketing and customer services purposes, Flipkart said. The features could, for instance, be used to offer more personalised customer experiences.
Microsoft already has a strong cloud presence in India, operating three regions there, while Amazon opened its first Indian AWS region in Mumbai last year.
Azure has also seen rapid expansion in the UK of late, with Microsoft launching its first British cloud services data centres last year to serve customers including the Minsitry of Defence and the NHS.
In October, however, Microsoft said would raise cloud services prices in the UK by up to 22 percent due to currency fluctuations caused by the referendum to leave the EU, a move expected to mean higher costs for the British government and businesses.
Microsoft has said it plans to open a data centre in France this year to futher boost European expansion, with Amazon saying it is also planning to begin operating an AWS region in the French capital this year.
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