FedEx, Microsoft Strike Technology Partnership in Shot at Amazon

Now that it’s detached itself from Amazon, FedEx has entered into a multiyear agreement with Amazon’s cloud computing rival Microsoft, with the first offering using the latter’s real-time intelligence capabilities to provide FedEx shippers with greater visibility into issues affecting transit times.

Called FedEx Surround, the solution leverages data to provide near-real-time analytics of shipment tracking, enabling more precise logistics and inventory management through use of Microsoft’s Azure cloud platform and its Dynamics 365 ERP. It can also collect multiple data points pulled in through FedEx’s scanning and IoT technology and analyze them with Microsoft’s suite of AI, machine learning and analytics solutions.

Shippers can gain enhanced visibility of a package’s location in transit, and near-real-time information about conditions such as severe weather or natural disasters, mechanical delays, clearance issues or incorrect addresses. This intelligence could enable retailers and ecommerce companies to reroute orders or make other changes to save time and keep end customers happy.

“FedEx has been reimagining the supply chain since our first day of operation, and we are taking it to a new level with today’s announcement,” said chairman and CEO Fred Smith in a release. “Together with Microsoft, we will combine the immense power of technology with the vast scale of our infrastructure to help revolutionize commerce and create a network for what’s next for our customers.”

FedEx and Microsoft said FedEx Surround will be available this summer, with other joint solution announcements coming later this year, the companies said.

“Now more than ever, organizations are counting on an efficient and capable supply chain to remain competitive and open for business,” said Satya Nadella, CEO of Microsoft, in the release. “Together with FedEx, we will apply the power of Azure, Dynamics 365 and their AI capabilities to this urgent need, building new commerce experiences that transform logistics for our mutual customers around the world.”

FedEx and Amazon ended their relationship last year, first severing their Express agreement and later ground. Many analysts said part of the reason was the low margins FedEx was realizing from Amazon’s business. UPS and the U.S. Postal Service continue to be major shipping providers for Amazon. The ecommerce giant of course has been building out its internal logistics, freight and delivery capabilities for the past few years, to the point where it’s handling the majority of its own volume.

Microsoft’s Azure platform has been the beneficiary of Amazon rivals as well as retailers who have opted against using its market-leading AWS cloud network.

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