(Bloomberg) -- Amazon.com Inc.’s cloud services division is teaming up with Verizon Communications Inc. to offer a 5G service that will push computing power closer to customers and enable a new generation of video gaming, robotic controls and car automation.

The two companies are in a race with Microsoft Corp. and AT&T Inc. to dominate “edge computing,” which allows millions of connected devices to more quickly reach a data service rather than waiting for a remote server farm to do the job.

Amazon Web Services started selling the service, which it’s calling Wavelength, on Tuesday in Chicago where at least one customer has already signed on: Bethesda Softworks, a unit of ZeniMax Media Inc. which produces video games including Doom, Rage and Fallout.

The rollout of 5G is limited so far to parts of a few dozen cities, and full-fledged, nationwide coverage isn’t expected for several years. But the race to be seen as a leader is under way. There’s a lot of potential new revenue at stake where cloud services and 5G connections intersect. Edge computing will be a $4 trillion market by 2030, according to industry analyst Chetan Sharma.

AWS is the world’s largest seller of rented computing power and data storage, services it provides using massive server farms located around the globe. Verizon, the largest U.S. wireless carrier, is rolling out 5G service that promises 10 to 100 times faster speeds and nearly zero lag times. The company expects to have 5G in parts of 30 cities this year.

“This is about creating an ecosystem with the best players, bringing them together to take advantage of what 5G can enable,” said Rima Qureshi, Verizon’s chief strategy officer.

Amazon plans to expand its edge computing service to other countries using partnerships with additional carriers. Earlier this year, Microsoft, through its Azure cloud service announced a “network edge computing” collaboration with AT&T’s 5G network. The two companies have started offering the service in Dallas.

Bethesda Softworks has been using AWS/Verizon’s Wavelength for a month, said James Altman, the company’s director of publishing. The service addresses one of the biggest challenges in cloud gaming: delays in the live action. Bethesda has been working with Orion, its own optimizing technology, to improve the experience.

“Lag reduction, visual fidelity, all of those problems present themselves, and in our testing using Orion on AWS Wavelength on Verizon’s 5G network we have the best streaming experience that we think is capable,” Altman said.

As big businesses in recent years moved software from their own data centers to the cloud, some pushed AWS and its cloud-computing rivals to bring their services physically closer. A delay of a couple hundred milliseconds as data travels from a distant server farm is fine for email, but it could be problematic for manufacturing control systems or video streaming.

To broaden the reach of its network and bring computing power closer to devices, AWS last year announced a product called Outpost, a server rack designed to sit in customers’ data centers.

“Compared to the previous 4G technology, this is transformative, that’s clear once you see this you’ll see how it unlocks the power of millions of connected devices,” said Matt Garman, vice president, AWS compute services.

To contact the reporters on this story: Scott Moritz in New York at smoritz6@bloomberg.net;Matt Day in Seattle at mday63@bloomberg.net

To contact the editors responsible for this story: Nick Turner at nturner7@bloomberg.net, Robin Ajello, Molly Schuetz

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