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Box salespeople are going to start pitching storage on Microsoft Azure

The two companies now have a co-selling agreement.

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Box CEO Aaron Levie
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Box and Microsoft are going to start working together in a new area: Sales. And that might be a little awkward for other cloud providers that Box partners with, especially Google.

Box announced on Tuesday that it would start offering storage on Microsoft cloud platform Azure as an option for Box customers. This is the first time the cloud document-management company will offer customers the option of specifying which public cloud provider will store their Box data, the company said.

Update: This is part of a co-selling agreement, which means Box will not be selling Azure services on their own, but as an option to purchase with a purchase of Box. Microsoft will also start pitching Box as part of sales of Azure, according to Box.

That means Box salespeople will essentially be pitching Azure to customers. Other cloud providers that partner with Box, including Azure competitors Google Cloud and Amazon Web Services, don’t have the same agreement in place.

This advancing of Box’s relationship with Microsoft is interesting because Box has been thought of as a potential acquisition target for Google.

By default, documents stored on Box sit on Box’s own servers and are backed up on AWS, according to Box’s chief strategy officer Jeetu Patel.

Box also offers an option for selecting geographic zones to store data, meaning companies can store information with Box on servers in specific countries, in order, for example, to comply with those country’s laws about data storage.

Data stored abroad is sometimes contained on servers from IBM, said Patel. As part of this agreement, Box will start adding Azure’s international locations to its zoned data program.

The new partnership gives Azure another edge over Google in the cloud, by increasing Azure’s exposure to large enterprise companies. Box counts 64 percent of the Fortune 500 as customers.

Azure already has more exposure than Google Cloud to large corporations through Microsoft’s productivity tools like Office 365; they hold more than 95 percent of the enterprise productivity market, with $12.7 billion in revenue.

Amazon, Microsoft and Google are the three largest public cloud providers, respectively. Google’s cloud business was previously estimated to have an annual runrate revenue of about $1 billion, according to RBC Capital Markets, trailing Amazon Web Services’ $12.2 billion and Microsoft Azure’s estimated $2.7 billion.

Box competes with Microsoft’s Office 365 productivity suite and Google’s G Suite set of productivity tools. In particular, Box offers options that compete with cloud document storage and sharing tools including Microsoft’s SharePoint and Google’s Drive.

Update: We have updated this post to include more details about the co-selling agreement between Box and Microsoft.

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