Under the memorandum of understanding signed by the two companies, they will explore joint development of future cloud solutions in Azure to enhance their respective gaming and content streaming services.
The pair said in a statement that working together will enable the companies to deliver better experiences for both customers and creators.
As part of the deal, Sony and Microsoft will also explore collaboration in the areas of semiconductors and AI.
“Sony is a creative entertainment company with a solid foundation of technology. We collaborate closely with a multitude of content creators that capture the imagination of people around the world, and through our cutting-edge technology, we provide the tools to bring their dreams and vision to reality,” said Kenichiro Yoshida, president and CEO of Sony.
“PlayStation itself came about through the integration of creativity and technology. Our mission is to seamlessly evolve this platform as one that continues to deliver the best and most immersive entertainment experiences, together with a cloud environment that ensures the best possible experience, anytime, anywhere.
“For many years, Microsoft has been a key business partner for us, though of course the two companies have also been competing in some areas,” he added. “I believe that our joint development of future cloud solutions will contribute greatly to the advancement of interactive content.”
Microsoft CEO Satya Nadella commented: “Sony has always been a leader in both entertainment and technology, and the collaboration we announced today builds on this history of innovation. Our partnership brings the power of Azure and Azure AI to Sony to deliver new gaming and entertainment experiences for customers.”
The two companies said they will share additional information “when available”.
The announcement follows Google’s unveiling of cloud gaming platform Stadia in March. “Our vision for Stadia is simple,” said the platform’s general manager Phil Harrison, who previously served as a both a top PlayStation and Xbox executive.
”One place for all the ways we play, where the worlds of watching and playing games converge into a new generation gaming platform, to connect game developers with players and YouTube creators in a way that only Google can.”
Microsoft is adopting an increasingly platform agnostic approach for its gaming division, and recently announced plans to bring Xbox Live features to Nintendo Switch.
Game streaming is said to be a key part of its plans for the next Xbox console, with its in-development Project xCloud tech recently moving to a new stage of testing ahead of the launch of public trials later this year.
Revealing the first PS5 details last month, lead system architect Mark Cerny called Sony cloud-gaming “pioneers”, adding its vision in this area “should become clear” as the company heads toward the next-gen console’s release. Sony’s PlayStation Now game streaming service has some 700,000 subscribers.