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Microsoft CEO Satya Nadella and AT&T CEO John Donovan. (Microsoft Photo)

AT&T is turning to Microsoft as the telecommunications giant aims to step up its 5G offerings and move big chunks of data into the cloud.

The two companies today announced an “extensive, multi-year alliance” that will see Microsoft become AT&T’s preferred cloud provider for non-network data. As part of the deal, Microsoft will help AT&T with its 5G push by bringing processing capabilities closer to the actual devices through edge computing.

The companies didn’t give a dollar value for the deal, but Reuters reported it is north of $2 billion.

“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. Together, we will apply the power of Azure and Microsoft 365 to transform the way AT&T’s workforce collaborates and to shape the future of media and communications for people everywhere.”

The two companies have teamed up before on a tracking and detection system for drones, network projects and blockchain solutions. Microsoft and AT&T expect to announce more joint services later this year.

In addition to the tech partnership, the tech companies said they will team up on “social good” initiatives. Without giving specifics, the companies said they are both focused on “addressing sustainability, accessibility, and community challenges such as homelessness and see an opportunity to support each other’s work to address urgent social needs.”

Both companies are in the midst of fierce technological competitions. Microsoft’s cloud division is trying to catch up to the incumbent cloud power Amazon Web Services. While AT&T is locked in a 5G race with Verizon and a potential combined force of T-Mobile and Sprint.

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