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LAS VEGAS—IBM signed a definitive agreement to acquire The Weather Company’s B2B, mobile and cloud-based Web properties, including WSI, Weather.com, Weather Underground and The Weather Company brand.
The news of the acquisition played heavily at the IBM Insight 2015 conference here, where IBM made a series of announcements with The Weather Company, including plans to build a set of new IBM Cloud Insight Services with the company and hosting a two-hour segment of the Weather Underground TV show on-site at the Insight conference. Financial terms of the deal were not disclosed.
However, the TV segment—The Weather Channel—will not be acquired by IBM but will license weather forecast data and analytics from IBM under a long-term contract. The combination of technology and expertise from the two companies will serve as the foundation for the new Watson Internet of Things (IoT) unit and Watson IoT cloud platform, building on a $3 billion commitment IBM made in March 2015 to invest in related offerings and services.
The planned acquisition would bring together IBM’s cognitive and analytics platform and The Weather Company’s dynamic cloud data platform, which powers the fourth most-used mobile app daily in the United States and handles 26 billion inquiries to its cloud-based services each day. The deal would extend the reach of IBM’s cloud data services capabilities and expand The Weather Company’s business capabilities and consumer reach on a global scale. The Weather Company’s cloud-based data platform will enable IBM to collect an even larger variety and higher velocity of global data sets, store them, analyze them and, in turn, distribute them and empower richer and deeper insights across the Watson platform.
“Just imagine what can happen when you bring a great B2B business and a great B2C business together,” Bryson Koehler, chief information and technology officer at The Weather Company, told eWEEK. With The Weather Channel’s app so prevalent with consumers, adding IBM’s analytics and cognitive tools to the mix will only serve to keep consumers and citizens better informed.
For instance, with weather data and IBM’s predictive technology, insurance companies would be able to foretell hailstorms in enough time to warn their clients to move their cars inside to avoid damage. Or governments could reach out to constituents with information about safety issues related to bad weather. That’s not to mention the impact of weather on retail, sports and entertainment, travel and other industries, Glen Finch, global leader of Big Data & Analytics for IBM Global Business Services, said in an interview at Insight 2015.
“About 12 months ago, we started down a data partnership path with Twitter, with The Weather Company and with Fox,” Finch said. “Our goal was to help our clients make better business decisions by providing them with more data. Now, we have a closer and deeper relationship with the best weather forecasting capability out there. You now have the power to know as opposed to infer.”
Indeed, The Weather Company and IBM formed a strategic alliance earlier this year to integrate real-time weather insights into business to improve operational performance and decision-making. Through the alliance, IBM licensed The Weather Company’s cloud data platform and collaborated with The Weather Company’s B2B division to deliver joint industry solutions, data services packages and APIs that enable businesses and developers to integrate real-time weather insights into business. Also, earlier this year, The Weather Company announced plans to shift the massive weather data services platform that powers its B2B division to the IBM Cloud.
Upon closing the acquisition, IBM will own The Weather Company product 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 ingests, processes, analyzes and distributes enormous data sets at scale in real time. The company’s sophisticated models analyze data from 3 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 products and services to more than 5,000 clients in the media, aviation, energy, insurance and government industries.
IBM Buys The Weather Company’s Digital Assets
“The Weather Company’s extremely high-volume data platform, coupled with IBM’s global cloud and the advanced cognitive computing capabilities of Watson, will be unsurpassed in the Internet of things, providing our clients significant competitive advantage as they link their business and sensor data with weather and other pertinent information in real time,” John Kelly, senior vice president of IBM Solutions Portfolio and Research, said in a statement. “This powerful cloud platform will position IBM to arm entire industries with deep multimodal insights that will help enterprises gain clarity and take action from the oceans of data being generated around them.”
Charles King, principal analyst at Pund-IT, said he believes the research data could be even more valuable over time since the announcement suggests that IBM plans to integrate cognitive features into weather analysis and predictions.
“One of the company’s reps told me that the impact of weather events in the U.S. alone is around $500 billion annually,” King told eWEEK at IBM’s Insight event. “So it’d be natural for IBM to develop predictive services for industries that are especially sensitive to weather events, including transportation, power utilities, construction, emergency & disaster services, travel, etc. Toss in their stated plans to leverage Weather Company data in the new Watson IoT solutions and services, and this deal could become extremely important to both IBM and its enterprise customers.”
The Weather Company’s mobile and Web properties handle seven times the volume of the world’s leading search engine, while serving 82 million unique monthly visitors, IBM said. The Weather Company’s platform can ingest a wide range of data at massive speed and scale, supporting a huge volume of queries at very low latency. IBM plans to advance The Weather Company’s digital advertising platform and skills, which have driven effective monetization of weather information through data-driven advertising, to build additional ad-sponsored consumer and business solutions.
“We see the next wave of improved forecasting coming from the intersection of atmospheric science, computer science and analytics,” David Kenny, chairman and CEO of The Weather Company, said in a statement. “Upon closing of this deal, The Weather Company will continue to be able to help improve the precision of weather forecasts and further deepen IBM’s Watson IoT capabilities by enabling the integration of global atmosphere and weather insights with enterprise information to create disruptive industry solutions that optimize decision-making.”
Cognitive insights derived from data generated by the Internet of things are transforming the ways in which entire industries operate. For example, predictive weather analytics, coupled with real-time analysis of social media chatter, detailed understanding of transportation flows and other related data, can help retailers and distributors finely tune and maintain availability of vital goods in times of need. Airlines can save millions of dollars annually by tapping multiple real-time and historical data sources to optimize fuel consumption, reduce delays and airport congestion, and improve passenger safety during disruptive conditions.
“IBM brings some pretty remarkable technology resources to the table, so I expect that WU’s [Weather Underground] creative development team will be able to take advantage of that and crank out some ground-breaking weather software,” said Dr. Jeff Masters, co-founder of Wunderground in a post to the Weather Underground blog.