IBM Nabs Cloud, Big Data, IoT Deal With The Weather Company
By combining IBM’s cloud computing, industry consulting and analytics expertise with WSI’s precision weather data and forecasts, the alliance enables entire industries to apply their understanding of weather to business outcomes and take action at a local level. For example, IBM said insurers pay more than $1 billion in claims every year for vehicles damaged by hail. WSI’s Weather Alert service, together with IBM Analytics, enables insurance providers to send policyholders text messages that alert them to impending hailstorms – and safe locations – so vehicles can be moved before damage occurs. These insights have the potential to save insurers up to $25 per policyholder per year in hail-prone areas, or millions of dollars annually, IBM said. In addition, utility companies are impacted by increases in temperature and relative humidity – even if just a few degrees – by dramatic increases in air conditioning use and power consumption, IBM said. The difference between 90 and 95 degrees in Texas, for example, can add up to $24 million more in electricity spending per day. With IBM and WSI, utilities will be able to more accurately predict power consumption so they can avoid over-producing power, reduce service interruptions and better serve customers. “This deal combines the capabilities of the world’s largest and most advanced commercial weather company with the leader in big data and analytics,” said David Kenny, chairman and CEO of The Weather Company, in a statement. “Together, we’ll help businesses and governments transform their decisions and operations around weather fluctuation at a scale that hasn’t been possible until now. This is a watershed moment for businesses that have long been impacted by weather but haven’t had the rich data or enhanced decision-making ability to drive positive business outcomes. The combination of our new high-resolution forecasting capabilities with IBM analytics opens up a world of possibilities for the enterprise.” The new IBM/Weather Company partnership builds upon IBM’s investment of $3 billion over the next four years in an Internet of Things (IoT) unit to develop a portfolio of cloud services, software and related intellectual property.“We need to be within 100 milliseconds of everyone on the planet — and we leverage the global reach and availability of AWS to deliver on that strategy,” Bryson Koehler, executive vice president and CIO of AWS, is quoted as saying in the case study. However, in response to queries about the roles of AWS and IBM at The Weather Company going forward, Koehler said in a statement: "The reports around a complete migration off of AWS were not accurate. I, and The Weather Company continue to believe in a multi-cloud architecture that allows us to manage workloads across multiple cloud providers. Our partnership announcements today are in addition to our long-standing and strong partnership with AWS." The addition of IBM to the party, however, indicates that The Weather Company has bought into the IBM big data and analytics strategy of delivering an integrated view of all their data in a single IoT platform.
IBM’s deal with The Weather Company calls into question the weather organization’s existing relationship with Amazon Web Services (AWS), which has supported The Weather Company’s cloud and big data strategy. A case study on the AWS site describes AWS as a key component of The Weather Company’s cloud strategy.