Thursday, October 29, 2015

IBM Buys The Weather Company's Digital Assets And Cloud-Based Properties

IT service giant IBM on Wednesday announced plans to acquire The Weather Company’s B2B data business, mobile and cloud-based properties, including and Weather Underground. Financial terms of the deal were not disclosed, but the Wall Street Journal reported of a $2 billion purchase price.

The combined entities will serve as the foundation for the new IBM Watson Internet of Things unit and Watson IoT cloud platform, building on a $3 billion commitment IBM made in March 2015 to make a significant investment in related offerings and services.

IBM emphasized that the deal doesn’t include the TV operations, and that the primary focus of the deal is on the Weather Company’s range of digital weather information assets, which include mobile app, websites and data sets. 

The two companies already have history of partnership. Earlier this year, the two companies forged an alliance to integrate real-time weather insights into business to improve operational performance and decision-making. IBM licensed The Weather Company’s cloud data platform and collaborated with the company’s B2B division to deliver joint industry solutions, data services packages and APIs that allows businesses and developers to integrate real-time weather insights into business. Also this year, The Weather Company announced plans to move its massive weather data services platform that powers its B2B division to the IBM cloud computing services.   

The Weather Company’s cloud-based data platform, which currently powers the fourth most-used mobile app daily in the United States and handles 26 billion inquiries each day, will allow IBM to collect an even larger amount and higher velocity of data sets, store them, analyzed them and in turn distribute them and empower richer and deeper insights across the Watson platform. The company’s sophisticated models analyze data from three billion weather forecast reference points, more than 40 million smartphones and 50,000 airplane flights per day, allowing it to offer a broad range of data-driven services to more than 5000 clients in the media, aviation, energy, insurance and government industries. 

Under the deal, IBM will acquire The Weather Company products and technology assets that include many of the world’s leading meteorological data science experts, precision forecasting capabilities and a high-volume cloud platform that digests, processes, analyzes and distributes huge amount of sets at a scale in real time. In addition, the deal will also gives IBM forecasting tools, cloud platform, data expertise and more touch points, which include mobile apps, websites, flight data and information products. The Weather Company will license its weather data from IBM under a long-term contract.

Dave Shull, CEO of the Weather Channel Television Network, said in a statement that the network will “continue to be owned and supported by our existing shareholders — Bain Capital, Blackstone and NBCUniversal — and operate as a standalone business.

IBM has been busy beefing up its analytics capabilities, taking strategic acquisitions.  In August, the company acquired medical imaging software firm Merge Healthcare for $1 billion.  IBM plans to integrate Merge with its new Watson Health unit and boost its imaging analytics services. In September, IBM struck an IoT-related analytics partnership with CPU core giant ARM.   

Founded in 1980 and based in Atlanta, Georgia, The Weather Company is a cable and satellite television channel that broadcasts weather forecasts and weather-related news and analysis, along with documentaries and entertainment programming related to weather. The company is currently owned by two private equity firms- Blackstone Group and Bain Capital, which include the online weather services Weather Underground and Intellicast, and weather data and software company Weather Services International

Image credit: ArsTechnica

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