IBM Announces New IoT Investments and Partnerships

By Charles King, Pund-IT, Inc.  April 1, 2015

IBM announced that it will invest $3 billion over the next four years to establish a new Internet of Things (IoT) business unit, and that it is also building a cloud-based open platform designed to help clients and ecosystem partners build IoT solutions. According to the company, new industry-specific cloud data services and developer tools will provide the means for clients and partners to integrate data from an unprecedented number of IoT and traditional sources and lead to systems that better inform enterprise decision-making. 

IBM estimates that 90 percent of all data generated by devices such as smartphones, tablets, connected vehicles and appliances is never analyzed or acted on. As much as 60 percent of this data begins to lose value within milliseconds of being generated. To address this challenge, IBM is announcing it will offer:

  • IBM IoT Cloud Open Platform for Industries: This platform will provide new analytics services that clients, partners and IBM will use to design and deliver vertical industry IoT solutions.
  • IBM Bluemix IoT Zone: New IoT services as part of IBM’s Bluemix platform-as-a-service will enable developers to easily integrate IoT data into cloud-based development, enrich existing business applications and deploy IoT apps.
  • IBM IoT Ecosystem: Expansion of its ecosystem of IoT partners such as AT&T, ARM and Semtech, and the newly announced alliance with The Weather Company will ensure the secure and seamless integration of data services and solutions on IBM’s open platform.

IBM noted that these new capabilities are illustrated in its global strategic alliance with The Weather Company through WSI, its global B2B division. WSI’s forecasting system ingests and processes data from thousands of sources, resulting in approximately 2.2 billion unique global forecast points and more than 10 billion forecasts per active weather day.

An IoT and cloud computing infrastructure will allow for the collection of data from more than 100,000 weather sensors and aircraft, millions of smartphones, buildings and even moving vehicles. A spokesman noted that The Weather Channel will also use IBM Cloud for its general computing needs, transitioning away from its previous cloud provider, Amazon Web Services (AWS).

Together, IBM and The Weather Company will focus on helping industries utilize their understanding of weather via three new kinds of cloud services:

  1. Watson Analytics for Weather: IBM and WSI will enable easy integration of historical and real-time weather data in business operations and decision making with IBM Watson Analytics. The companies will jointly develop industry solutions for insurance, energy & utilities, retail and logistics, among others.
  2. Cloud and Mobile App Developer Tools: Entrepreneurs and software developers will be able to rapidly build mobile and web apps that take advantage of WSI data combined with data from operational systems, connected devices and sensors using advanced analytics through Bluemix, IBM’s cloud application development platform.
  3. Business and Operational Weather Expertise: Thousands of consultants from across IBM Global Business Services will be trained to combine WSI data with other sources to more effectively interpret industry pain points, providing clients new insights that solve business problems.

By leveraging IBM’s cloud computing, industry consulting and analytics expertise with WSI’s precision weather data and forecasts, the two companies can now enable entire industries to utilize understanding of weather on business outcomes and take action at a local level.

The pitch

IBM’s investments and partnerships aim to accurately gauge the temperature of IoT

Final analysis

Computing technology is in a constant state of change and nowhere is that more apparent than in the evolution of the Internet of Things. Discussions of IoT arose a few years back from a confluence of increasingly intelligent embedded and edge technologies and increasingly powerful network solutions, including global mobile and satellite systems.

The concept then, as now, was that aggregating data collected from those devices could result in actionable information that would be invaluable to thousands of organizations and millions of people. IoT is a natural area of interest for IBM for a number of reasons. First and foremost, it intersects seamlessly with the company’s longstanding efforts around IT infrastructure and analytics.

The fact is that collecting, analyzing and deriving value from countless of information sources and massive data sets is beyond the means (or even the imaginations) of the vast majority of IT vendors. Given the depth of the IBM’s experience, the $3B IoT investment it plans over the next four years is a hefty sum that indicates not just the company’s seriousness but the commercial potential it recognizes. A lot of other vendors have certainly talked up IoT, but none made a commitment of this size and scope, and many will likely blanch when they see IBM’s table stakes.

In addition, the tie-ins between IoT and other IBM solutions is intriguing, especially related to solutions for specific vertical industries, developers (via BlueMix) and the company’s partner ecosystem. That last point – partners – is especially important since by its nature, IoT is beyond the grasp of any single vendor. IBM has some of the most effective solutions available to apply to IoT problems, but the company can’t be everywhere at once. As a result, some of its most important IoT developments are likely to arise through partnerships, so it’s worth keeping an eye on what IBM does here.

The new alliance with The Weather Channel’s WSI organization offers a glimpse into IBM’s current strategy and, perhaps, a model of future partnerships. The sensors used in weather stations aren’t highly demanding technologically. In essence, they’re designed to collect and deliver particular data (temperature, wind speed, wave movement, barometric pressure, etc.) on a specific schedule so that changes can be observed and analyzed.

But the data collected from a worldwide network of weather stations and other sources could be immensely useful to a wide variety of global and local companies, including the insurers, retailers, and power utilities cited in the announcement. Plus if, as many scientists and insurance companies believe, we’re heading into a future where extreme weather events become increasingly common, the partnership should be highly profitable for both companies and invaluable for their respective customers.

These latest announcements are impressive on their own, but are even more so when considered alongside the progress of IBM’s Twitter alliance. In essence, they demonstrate that IBM believes developing effective IoT solutions requires vendors to gather digital intelligence from wherever it lives, from users’ comments on massively scalable social networks to data gleaned by sensors in remotely deployed weather stations. No other approach provides so accurate a measure of a situation’s temperature, be it weather- or market-related.

Overall, IBM’s IoT strategy, investments, solutions and partnerships find the company adopting innovative and powerful technologies that will help it adapt to rapidly changing markets and customer requirements. Collecting that information and turning it into insights business customers can act on is the central aim of the Internet of Things and the primary goal of IBM and its strategic allies. These new solutions and alliances are the simply the first of what we believe will be many collaborative IoT efforts.

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