Cloud Hosting

An antenna for a satellite ground station

Amazon

Microsoft is looking to challenge Amazon in offering a service that connects satellites directly to the company's cloud computing network, according to documents the company filed with the Federal CommunicationsCommission last month

The effort shows how the two largest providers of cloud infrastructure data centers in far-flung places that can host websites and run applications with a smorgasbord of computing and storage services regularly seek to one-up each other. That way, the companies can appear ready and willing to meet many of the needs of prospective customers.

Microsoft plans to connect a Spanish imaging satellite to two ground stations both located in Microsoft's home state of Washington to show that it can directly download satellite "data to the Azure Cloud for immediate processing," the FCC documents said. A ground station, sometimes called an earth station, is the vital link for transmitting data to and from satellites in orbit. Microsoft notably proposed to construct one of the two ground stations itself at its data center in Quincy, Wash.

The FCC on Sept. 2 authorized Microsoft to perform proof-of-concept demonstrations of the service. The authorization gives Microsoft a six month license that allows for communications and imagery data downloads. The Spanish satellite, called Deimos-2, was launched into orbit in June 2014. The satellite is operated by a subsidiary of Canadian satellite imagery companyUrtheCast and, for the tests, the Deimos-2 satellite will only be in range of Microsoft's antennas for "just a few minutes."

Microsoft wants to run the demonstrations before, during and after its Ignite conference for IT professionals, which starts on Sept. 22, the company said in a different FCC filing.

"If the demonstrations result in significant market interest, Microsoft will file an application for regular earth station authority with the International Bureau (IB) to support future commercial operations, and that application will include a request for U.S. market access for DEIMOS-2," the company wrote.

Microsoft declined CNBC's request for comment.

An AWS Ground Station satellite antenna at one of the company's data center in Boardman, Oregon.

Amazon

Amazon leads the growing cloud-computing market, with45% in 2019, while Microsoft had about 18%, according to technology industry research company Gartner. Alibaba, Google, Tencent and other cloud providers each had less than 10% share. Microsoft in particularhas a website listing the services available from AWS and its own corresponding offerings, although Ground Station was not listed on the website on Friday. Cloud infrastructure delivers most of Amazon's operating income, and for Microsoft it's growing faster than other prominent areas, such as Windows and commercial subscriptions to the Office 365 productivity bundle.

Microsoft outlined in the filings that, by building a network of ground stations, it wants to show to satellite firms the potential benefits of connecting directly to the company's Azure cloud. But Microsoft's not alone. Its strategymatches closely with the one Amazon outlined in November 2018 when it launched its AWS Ground Station service, pitting the tech giants against each other in a new realm of cloud computing services.

AWS Ground Station was Amazon's first public move into space-related hardware, with the company also establishing itsAerospace and Satellite Solutions division and working on its own space-based internet network called Project Kuiper.The company's ground station network began service this year at two of its first of 12 planned locations. While Amazon has not disclosed all of AWS Ground Station's customers so far, the company has noted the service is being used byNASA's Jet Propulsion Lab and companies such as Capella Space, Spire Global, Maxar Technologies, Myriotaand Thales Alenia Space.

Amazon says that AWS Ground Station can connect with wide range of satellites thatfly both low and medium Earth orbits. The company boasts that AWS Ground Station reduces the time it takes to process and analyze satellite data "from hours to minutes or seconds," with customers saving "up to 80% on the cost" of traditional ground station operations.

CNBC's Jordan Novet contributed to this report.

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Microsoft wants to take on Amazon in connecting satellites to the cloud - CNBC