Microsoft claims it’s making progress assembling a more expansive telco cloud stack for operators six months after it inhaled AT&T’s Network Cloud technology via acquisition.

Azure for Operators, now combined with the crown jewels of AT&T’s seven-year effort in SDN and network virtualization, includes more than 60 cloud-native network functions (CNF) and virtual network functions (VNF) from 15 vendors, Microsoft’s VP of 5G strategy Shawn Hakl explained in a blog post. 

AT&T in selling its technology to Microsoft also announced plans to move its 5G network core, workloads, and services to Microsoft’s Azure for Operators platform. The operator at the time said a 5G standalone core, something it has yet to deploy, will be the first order of business and it plans to move its existing network cloud to Azure by mid-2024. 

“Many of the benefits that Microsoft delivered in the enterprise space are directly applicable in the network space,” but those tools and services must first be modified to meet unique carrier requirements, Hakl explained. “Our efforts are aimed at getting workloads on the network to function on a carrier-grade cloud, which is a hybrid cloud, spanning both public and dedicated on-premises cloud infrastructure.”

Microsoft, as part of its deal with AT&T, also gained roughly 100 engineers from the operator. The enlarged team is now working to build AT&T’s Network Cloud technology into Microsoft’s standard hybrid-cloud product and a telco-centric platform for AT&T and other operators to deploy, according to Hakl.

The combination of AT&T and Microsoft’s efforts in this space is unique because it marks “the first time that a tier-one operator has embraced commercial hybrid cloud technology to run mobility network workloads,” wrote Hakl, a former longtime Verizon executive.

The arrangement is also multi-vendor and focused on the mobile core network versus less comprehensive opportunities at the edge, he added. All of the Azure for Operators capabilities will be combined with Microsoft’s edge and hybrid management platforms, and fueled by a growing ecosystem of equipment, hardware, and software vendors, Hakl wrote.

“We believe the result will be better resiliency across the network, cost advantages when it comes to scaling existing services, and a more effective introduction of new services resulting in continuous improvements to the customer experience,” he added.

More broadly, Microsoft’s 5G strategy links the private Azure Edge Zones service it announced in 2020, Azure IoT Central, virtualized evolved packet core (vEPC) software it gained by acquiring Affirmed Networks, and CNFs it brought on board when it acquired Metaswitch Networks. 

While Microsoft has taken on the task of developing hybrid cloud technology that supports mobile core network workloads, AT&T and other prospective operator customers will continue to select and manage the VNFs and CNFs, Hakl explained. 

“In terms of security, it’s important to note that Microsoft does not access AT&T customer data — AT&T continues to hold access to that data, and Microsoft cannot see it,” he added. 

While AT&T effectively realized that no matter how invested and talented it had become in cloud computing, it was no match for the might of hyperscalers, a clear separation between hyperscale and network domains will be critical for Microsoft and its cloud rivals to attract more operators to this vision.