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Snowflake-Microsoft deal shows retailers prefer Azure over Amazon Web Services

With the reach of cloud services expanding to new markets rapidly, corporate computing is undergoing a revolution. The mass migration of small enterprises to cloud in recent times is setting a new trend, especially in the selection of service providers.

The market this week witnessed a strategic deal that is reflective of this emerging trend in the cloud business. For California-based data-warehousing start-up Snowflake Computing, teaming up with Microsoft’s (MSFT) cloud computing platform Azure was the right choice at a time when it is doing the groundwork for an IPO. Meanwhile, Azure has long been racing to keep pace with Amazon’s (AMZN) AWS, which dominates the cloud sector.

Snowflake joined hands with Azure in the wake of a section of customers demanding an alternative to Amazon, on which the former currently runs. It seems Amazon’s phenomenal growth in the retail segment is making it a less preferred partner for other retailers who want to use cloud services.

Snowflake joined hands with Azure in the wake of a section of customers demanding an alternative to Amazon

It is natural for the likes of Walmart (WMT) to be apprehensive about sharing sensitive information with software that runs on Amazon’s cloud platform. Other cloud services like Google (GOOG, GOOGL) are also benefitting from the retailers’ aversion to Amazon in the cloud segment.

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As per the deal, the Snowflake software will be immediately available on Azure’s public cloud at the same price as that of Amazon. It is believed that the partnership will better equip Azure to compete with Amazon.

Interestingly, Snowflake owes its business prowess to Microsoft to a certain extent. Its current CEO Bob Muglia perfected his skills while serving Microsoft a couple of decades ago, holding several key posts until he stepped down in 2011.  Though Snowflake unveiled its plans to use Azure as a platform for its software only recently, it was widely expected that it would clinch a deal with Azure considering Muglia’s long association with Microsoft.

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Snowflake runs a cloud-based data warehouse designed for analytical applications, an emerging concept that focuses on reading data rather than inputting information into the system. Being a pioneer in this specialized area, the company is attracting huge investments that contribute to its growth.

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