Partnerships

AWS and Booz Allen Hamilton are expanding their partnership to provide federal agencies with ready-made digital solutions for cloud migration, cybersecurity, and AI. The collaboration combines AWS cloud services with Booz Allen’s expertise to improve decision-making, reduce costs, and enhance cybersecurity. These solutions will be available through the AWS Marketplace to support the U.S. government's evolving technology needs.

Good News

AWS is launching a £5m ($6.2m) grant to improve cybersecurity in UK educational institutions, offering cloud-based security solutions, training, and incident response support. This follows a government report showing widespread cyberattacks on schools and universities. Similar grants were previously launched in the US and Canada.

Offerings

Microsoft has added DeepSeek’s reasoning model R1 to its Azure AI Foundry platform after extensive security testing and evaluations. The company also plans to release smaller, local versions of R1 for Copilot+ PCs. Microsoft aims to expand its AI model catalog and explore enterprise applications for R1.

Deals

The Flemish government has partnered with Microsoft to drive digital transformation, making Microsoft 365 available to all local administrations and equipping 10,000 public sector employees with Copilot. The initiative aims to enhance efficiency through AI-driven automation following successful pilot projects in 2024. The government emphasizes a thoughtful, ethical, and secure approach to AI adoption.

Bad News

Microsoft's stock dropped 6% as its AI investments failed to significantly boost Azure cloud revenue, while Meta gained 4% after Zuckerberg reassured investors about growth. Analysts noted Microsoft's focus on AI workloads may have slowed core Azure growth, delaying the expected acceleration. The company’s weaker-than-expected cloud forecast led to a market cap loss of around $182 billion.

Microsoft will retire Dynamics 365 Unified Service Desk (USD) by June 2028, phasing out support and updates in the years leading up to that date. The company recommends users transition to Customer Service Workspace (CSW), which offers faster performance, AI-driven agent assist, and ongoing updates. While Microsoft is pushing CSW as the preferred alternative, other companies like Google and Here provide similar unified agent desktop solutions.

Strategy

Salesforce CEO Marc Benioff highlighted Agentforce's rapid success, stating it has secured thousands of deals in Q4 and significantly reduced Salesforce's own case volume. Agentforce allows businesses to deploy AI-powered agents for automating enterprise workflows, with companies like AAA and Wiley already reporting efficiency gains and high ROI. Salesforce has quickly expanded the platform with Agentforce 2.0, introducing enhanced management tools, a reasoning engine for improved decision-making, and industry-specific AI solutions like Agentforce for Retail.

Strategy

SAP is expanding its Executive Board with a new Strategy & Operations division, appointing Sebastian Steinhäuser to lead it. The company also introduced a new CTO, two Chief Revenue Officers, and an extended Executive Board to support its "AI-first, Suite-first" strategy. These leadership changes aim to improve digital transformation, customer success, and cloud adoption while aligning global initiatives.

Deals

Mercedes-Benz is integrating SAP’s cloud-based "RISE with SAP" program on AWS to modernize its IT infrastructure and improve operational efficiency. This transition standardizes processes across finance, logistics, and after-sales services while incorporating AI-driven automation for faster decision-making. The partnership aims to enhance digital transformation, reduce complexity, and position Mercedes for long-term competitiveness in the automotive industry.

Strategy

ServiceNow reported $10.98 billion in annual revenue, growing 22% year-over-year, with AI-driven automation playing a key role in its strategy. The company introduced AI Agent Orchestrator, AI Agent Studio, and pre-built AI agents to enhance workflows across IT, HR, and customer service. Meanwhile, SAP posted €34.2 billion in annual revenue (10% growth), emphasizing its AI initiatives, including Joule AI and cloud migration programs like Rise with SAP and Grow with SAP.

ServiceNow has officially entered the CRM market, leveraging its Customer Service Management (CSM) platform with AI-driven automation and deep enterprise data integration. Unlike traditional CRM providers, it focuses on complex service workflows, integrating ERP and back-end data to deliver a more data-rich customer experience. While its high complexity and cost pose challenges, ServiceNow is expanding partnerships and hiring 3,000 employees to support its CRM push, aiming to compete with Salesforce, Microsoft Dynamics, and Oracle.

ServiceNow is acquiring Cuein to enhance its AI agents' ability to analyze and process customer interaction data for actionable insights. The acquisition will strengthen ServiceNow’s Workflow Data Fabric, improving AI-driven automation and decision-making across enterprises. The deal is expected to close in Q1, further advancing ServiceNow’s AI capabilities in customer service and business operations.

Partnerships

ServiceNow and Google Cloud are expanding their partnership, making ServiceNow’s platform and AI-driven workflow solutions available on Google Cloud Marketplace and Google Distributed Cloud. The integration will enhance CRM, ITSM, and security incident response by leveraging Google’s AI infrastructure and BigQuery analytics for real-time automation. ServiceNow continues strong growth, reporting 23.5% revenue increase over the past year, while also acquiring Cuein to further improve its AI capabilities.

Bad News

VMware users are frustrated with Broadcom’s new licensing policies, which now require a three-year upfront commitment for vSphere renewals instead of annual renewals. Customers argue this is a deliberate move to lock them in as many consider migrating away due to steep price hikes and the removal of perpetual licenses. Broadcom claims to offer flexibility, but customers and analysts warn that transitioning away from VMware could be costly and complex.

Partnerships

ServiceNow and Google Cloud are expanding their partnership, making ServiceNow’s platform and AI-driven workflow solutions available on Google Cloud Marketplace and Google Distributed Cloud. The integration will enhance CRM, ITSM, and security incident response by leveraging Google’s AI infrastructure and BigQuery analytics for real-time automation. ServiceNow continues strong growth, reporting 23.5% revenue increase over the past year, while also acquiring Cuein to further improve its AI capabilities.

EPAM Systems has expanded its partnership with Google Cloud to develop AI-powered solutions for the media, energy, and retail industries using the Vertex AI platform. The collaboration will focus on industry-specific applications, including video search for media, geospatial data visualization for energy, and AI-driven retail assistance. EPAM also aims to grow its financial services capabilities through acquisitions, while strengthening its AI expertise and digital transformation initiatives.

Deals

Servier has extended its partnership with Google Cloud for another five years to enhance pharmaceutical R&D using AI. The collaboration will help analyze medical data in real time, with around 60 AI use cases identified, including drug discovery and optimization. Servier has also begun integrating Google Cloud’s AI tools for employees to accelerate research productivity.

Strategy

AI in 2025 will become a critical tool in enterprise workflows, with agent-based automation enabling more autonomous decision-making and process management. Companies will need clear ROI strategies to justify AI investments, while AIOps tools will help manage tech debt and streamline IT operations. Meanwhile, increasing global AI regulations, led by the EU, could either hinder innovation or set a precedent for other regions.

Partnerships

BT revamped its approach to SMB customers by integrating data intelligence, aiming to improve acquisition and retention through AI-driven insights and personalized offers. Partnering with EY and Pegasystems, it consolidated disparate data sources into predictive models to better target high-value customers and enhance engagement. Despite technical advancements, cultural resistance among sales teams remains a challenge, requiring continuous efforts to drive adoption and align with broader organizational changes.

Bad News

Nvidia lost nearly $600 billion in market value after DeepSeek’s AI model R1 demonstrated high efficiency with lower hardware costs, raising concerns about reduced demand for Nvidia’s GPUs. However, analysts argue the market overreacted, as the breakthrough could actually expand AI adoption and increase demand for Nvidia’s inference chips. Some investors and industry experts believe Nvidia remains well-positioned, despite growing competition from Chinese firms like Huawei.