The Coca-Cola Company has entered into a $1.1 billion agreement with Microsoft to enhance its cloud computing infrastructure and integrate Microsoft’s generative AI technologies globally.
As part of the five-year “strategic partnership,” Coca-Cola and Microsoft will collaborate to pioneer new applications of technology such as the Azure OpenAI Service. This collaboration aims to create “innovative generative AI use cases across various business functions,” a statement revealed.
Coca-Cola has transitioned all its applications to Microsoft Azure, with the majority of its major independent bottling partners doing likewise.
The beverage giant has been utilising generative AI for nearly a year and has already integrated Azure OpenAI Service into diverse areas ranging from “marketing to manufacturing and supply chain and beyond”.
Judson Althoff, Microsoft’s Chief Commercial Officer, commented, “Through our long-term partnership, we’ve made significant progress to accelerate systemwide AI transformation across The Coca-Cola Company and its network of independent bottlers worldwide. We’re proud to support Coca-Cola as it continues to embrace the era of AI and looks to solutions like Azure OpenAI Service and Copilot to drive innovation across every area of its business.”
The company known for Sprite is also exploring generative AI-powered digital assistants via Azure OpenAI Service to enhance employee efficiency in customer interactions and operational procedures, according to a statement issued today (23 April).
John Murphy, CFO of The Coca-Cola Company, reflected on the partnership’s evolution, stating, “This new agreement builds on the success of Coca-Cola’s partnership strategy with Microsoft, showing our commitment to ongoing digital transformation.”
Back in 2020, Coca-Cola signed a five-year, $250 million contract to utilise Microsoft’s cloud and business software.
Josep Bori, Research Director at GlobalData, Just Drinks’ parent company, analysed the strategy: “This is a classic play in the technology world, whereby a player uses its dominant position in one product or service to help a fledging new offering. Microsoft itself has done this before, with products such as its Internet browser, its media player, and even its cloud computing services. Microsoft has made a big commitment to OpenAI technology and is now trying to find ways to monetise the technology. It seems the right approach to use leading customers such as Coca-Cola to explore the ways in which this could be achieved, both from a technological and a marketing perspective. For instance, Coca-Cola eventually deciding to use CoPilot for Microsoft 365 internally if the testing is successful would certainly be an excellent reference for further sales.”
In related developments, Coca-Cola HBC, a significant bottler operating in 29 countries across Europe and Africa with The Coca-Cola Company, is currently striving to enhance its operations and boost sustainability through technological investments.
Mourad Ajarti, Chief Digital and Technology Officer at Coca-Cola HBC, during an interview with Just Drinks, detailed their strategic plans involving Microsoft and digital twins technology. He explained, “We have a plan that we are executing against to get into 50-plus lines by 2027, applying exactly the same digital twin technology and AI technology on top of every line that we have. We are talking energy efficiency, water efficiency, changeover efficiency, in a way that not only delivers productivity from an operation point of view but also sustainability because we are cutting the usage of energy, we are cutting the usage of water.”
