Microsoft’s investment in Vodafone IoT is a surprise given Microsoft’s other priorities

Vodafone announced that Microsoft “intends to invest in Vodafone’s managed IoT connectivity platform, which will become a separate, standalone business by April 2024”, on 16 January 2024.

The deal is significant for several reasons – it is the first announced external investor in Vodafone’s new IoT business (first announced in mid-2022 and covered in our previous article). The announcement seems broadly positive for Vodafone, but it is a surprise that raises many questions. The impression is that Microsoft is a somewhat reluctant investor in Vodafone’s IoT unit; this is probably something both parties will want to change.