I'm not sure it's a partnership. It looks and reads like the standard authorized data sharing setup. Anyone can configure that. It uses an open protocol that's standardized, let's users control the information shared with explicit consent and is basically what you want out of any entity that holds all your crap. The only thing it's really lacking is a standard protocol for sharing the actual data.
Linux distributions have it.
Microsoft using Google's public documented API is a long way from a partnership.
Some of your emphasis is a little backwards. In the cloud computing environment, Amazon is bigger than Microsoft, and windows isn't even particularly significant. Azure primarily provides Linux infrastructure instead of Windows. AWS is bigger in the government cloud sector than Microsoft.
For servers, Linux is hands down the os of choice. It's just not even close. Where Microsoft has an edge is in business software, like Excel, word, desktop OS and exchange. Needing windows server administrators for stuff like that is a pain when you already have Linux people for the rest of your stuff which is why it gets outsourced so often. It's not central to the business so no sense in investing in people for it.
Microsoft isn't dominating the commercial computing sector, they're dominating the office it sector, which is a cost center for businesses. They're trailing badly in the revenue generation service sphere. That's why they've been shifting towards offering their own hosting for their services, so you can reduce costs but keep paying them. Increased interoperability between windows and Linux from a developer standpoint to drive people towards buying their Linux hosting from them, because you can use vscode to push your software to GitHub and automatically deploy to azure when build and test passes.
Being on the cost side of the ledger is a risk for them, so they're trying to move to the revenue side, where windows just doesn't have the grip.