> Microsoft is preparing to bring Amazon as a customer for its 365 cloud productivity tools in a deal worth over $1 billion, news site Insider reported on Tuesday, citing an internal document and a person familiar with the matter.
> The e-commerce giant has committed the amount for over five years and to secure more than one million Microsoft 365 license seats, according to the report.
What’s the scope of the deal beyond Microsoft 365 and how much does each license cost? The numbers, based on a back-of-the-envelope-calculation [1], make it seem like Amazon couldn’t negotiate better rates for such high volumes because its stuck with having to deal with Microsoft.
[1]: 1 billion over five years is 200 million a year. With 1 million seats (keeping it at the lower bounds), it’s $200 per user per year, which is $16+ per user per month. Microsoft Business Premium is currently on sale for those who buy from its website at $19.8 per user per month (usually $22 a month).
> The e-commerce giant has committed the amount for over five years and to secure more than one million Microsoft 365 license seats, according to the report.
What’s the scope of the deal beyond Microsoft 365 and how much does each license cost? The numbers, based on a back-of-the-envelope-calculation [1], make it seem like Amazon couldn’t negotiate better rates for such high volumes because its stuck with having to deal with Microsoft.
[1]: 1 billion over five years is 200 million a year. With 1 million seats (keeping it at the lower bounds), it’s $200 per user per year, which is $16+ per user per month. Microsoft Business Premium is currently on sale for those who buy from its website at $19.8 per user per month (usually $22 a month).