Microsoft and Sony surprisingly partner on AI, camera and gaming efforts, with Sony to use Azure for “game and content streaming services”

In an unlikely and unforeseen turn of events, Microsoft and bitter console rival Sony have set aside their competitive arms to ink a partnership developing future AI and entertainment platform solutions.

According to a post from the Microsoft News Center, the company plans to collaborate with Sony on new cloud-based solutions moving forward; and while there are several mutually beneficial business that makes sense in light of this new partnership, both Sony and Microsoft specifically highlighted the least likely ones to work together on.

Under the memorandum of understanding signed by the parties, the two companies will explore joint development of future cloud solutions in Microsoft Azure to support their respective game and content-streaming services. In addition, the two companies will explore the use of current Microsoft Azure datacenter-based solutions for Sony’s game and content-streaming services. By working together, the companies aim to deliver more enhanced entertainment experiences for their worldwide customers. These efforts will also include building better development platforms for the content creator community.

As part of the memorandum of understanding, Sony and Microsoft will also explore collaboration in the areas of semiconductors and AI. For semiconductors, this includes potential joint development of new intelligent image sensor solutions. By integrating Sony’s cutting-edge image sensors with Microsoft’s Azure AI technology in a hybrid manner across cloud and edge, as well as solutions that leverage Sony’s semiconductors and Microsoft cloud technology, the companies aim to provide enhanced capabilities for enterprise customers. In terms of AI, the parties will explore the incorporation of Microsoft’s advanced AI platform and tools in Sony consumer products, provide highly intuitive and user-friendly AI experiences.

In signing the new deal, Sony signals to gamers and fans that a gaming ecosystem is much larger than the consoles sitting under tvs and the dissent found in numerous forums, as well as further legitimizing Microsoft Azure cloud competitive advantages.

Amazon’s cloud service AWS has cast a looming shadow despite Microsoft’s Azure gains year over year, Amazon continues to sign and resign lengthy contracts with top-tier retailers and internet businesses.

With Sony being a public gaming rival of Microsoft, it seemed a natural fit that Amazon would capture Sony’s business as the gaming industry transitions to the cloud, however, it seems Sony and Microsoft are aiming for a loftier partnership that will also mutually benefit both companies beyond gaming.

In addition to working on datacenters and streaming technologies, Microsoft and Sony will also be collaborating on the development of new semiconductor and AI technologies as well as building out new Intelligent cameras.

Microsoft’s image recognition technology was recently lauded for its accuracy and the company is already packaging that software alongside its miniaturized Kinect technology to sell new enterprise-grade web cameras for factories, shipping lines, construction sites and more. Combined with Sony’s cutting-edge image sensors and massive distributions channel’s, both companies could be on the brink mainstreaming next-level image processing technology.

The deal is in the early stages and all the details and conditions are still being hashed out, but with Sony and Microsoft’s Xbox One and PlayStation 5 rumored to sport similar hardware specs and architecture, a collaboration of this nature could be the start of an easier game development path for studios, freeing them to concentrate more on bugs and DLC preparation than porting and separate FPS rates.

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Is this the right move for Sony or Microsoft?