Vodafone on Tuesday announced a 10-year partnership with Microsoft worth $1.5 billion.

The British telco said that it would transform customer experience using Microsoft’s generative AI, hyperscale Vodafone’s managed IoT connectivity platform, develop new digital and financial services for businesses, particularly SMEs across Europe and Africa, and overhaul its global data centre cloud strategy.

Vodafone will invest $1.5 billion over the next 10 years in cloud and customer-focused AI services developed in conjunction with Microsoft, while the Windows company will use Vodafone’s fixed and mobile connectivity services and become an equity investor in Vodafone’s managed IoT platform when it is spun out as a standalone business by April 2024.

Vodafone added that digital services generated by the new partnership will use the latest generative AI technology to provide a highly personalised and differentiated customer experience across multiple channels.

With AI ethics increasingly becoming central to discussions surrounding the tech, Vodafone said that the GenAI will be built on “unbiased and ethical privacy and security policies under Vodafone’s established framework for responsible AI”.

Margherita Della Valle, Vodafone Group chief executive, said: “Today, 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 boss Satya Nadella added: “This new generation of AI will unlock massive new opportunities for every organisation 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.”

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