Microsoft and Google to merge for $1.6B acquisition

Microsoft and Alphabet have agreed to merge their cloud services business, with Microsoft taking over the cloud and Alphabet taking over enterprise services.

The deal, announced Wednesday, will create a company that can be sold to both companies at a discounted price.

Microsoft’s cloud services group, which includes Bing and Office, will continue to be run by the Redmond, Wash., company.

Alphabet will take on the enterprise services business.

Microsoft Chief Executive Satya Nadella said the deal was a major boost for both companies, and a significant step toward building on Microsoft’s growing success in cloud computing.

“We’ve got a fantastic opportunity to deliver on the promise of cloud computing,” he said at the Microsoft event.

“I think it’s going to make our customers happy, and I think it will drive the growth of both businesses.”

Nadella did not give details of the price or size of the deal, but said the merged company would be valued at $1 billion.

Alphabet has been trying to boost its cloud business with investments in data centers, and said it would not take a large-scale bet on the business as a whole.

Google, meanwhile, will still own its search engine, YouTube, which will continue as a separate entity.

Alphabet said it will continue making Google’s YouTube videos available in the cloud.

“Google has a long history of building powerful search and video platforms and we are excited to work with Alphabet on this strategic acquisition,” said Google CEO Sundar Pichai.

Google said it is also planning to launch Google Cloud Platform as a standalone product, with Google CEO Larry Page calling it “the most important platform in the world today.”

Google Cloud Platform will provide a seamless integration between Google, Google apps, Google TV, YouTube and the rest of Google’s services, including Google Now.

The new company will focus on delivering an experience for Google products that can serve as the foundation for the future of Google Search, Google Maps, Google+ and other services, Google said.

“This is a significant and exciting acquisition for Google,” said Jeff Dunn, an analyst at Forrester Research.

“The deal is an example of how Google’s strategy of creating a single, unified ecosystem for the services it provides can work, and it shows how the search giant can drive growth through its cloud offerings.”

The merger marks Alphabet’s first acquisition of a publicly traded company in its history.

The news came as Alphabet’s stock jumped 5% to $50.75, and as the tech industry braces for a potential showdown between the big tech companies over how to handle the rise of the Internet of Things and the potential threat to the dominance of the likes of Microsoft and Amazon.

Alphabet’s shares have been up nearly 12% since the beginning of the year.

The agreement is expected to close on Friday.

Alphabet and Alphabet said the combined company will be valued between $500 billion and $1 trillion.

Alphabet shares were trading at $46.84 at 3:59 p.m.


Microsoft, the largest U.S. technology company by revenue, has struggled to maintain its footing in cloud services as competitors such as Amazon and Google have taken advantage of the rise in popularity of such applications.

Microsoft has been experimenting with cloud services for years, but the merger is the latest sign of the company’s changing strategy.

In a post on its blog, Microsoft said it was not involved in the acquisition and that it will be focused on cloud computing as a core business.

Google has been aggressively pursuing cloud services, building its own data centers in the San Francisco Bay Area and moving its headquarters out of the nation’s capital.

Google has also tried to expand into other sectors, such as mobile.

Google, which has a market value of $68.2 billion, has about 1,000 employees.

The merger could also benefit Alphabet, which is now owned by the Microsoft group.

It already has a sizable stake in Google, having invested $1bn in the search company in 2014.

Alphabet also owns the smartphone maker Motorola Mobility, which could make its own bets in cloud, and Google has been building up its own enterprise services division, including its Gmail service.