Microsoft, which analysts believe to be the second largest cloud computing provider by revenue behind rival Amazon Web Services, has been building out specific cloud computing offering to go after carriers, and AT&T is the Redmond, Washington-based company’s first major win.

The two also said that Microsoft will purchase software and intellectual property developed by AT&T to help build out its offerings for carriers. The companies did not disclose the terms of the deals, but said that Microsoft will make job offers to several hundred AT&T engineers.

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