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#Business

IBM to invest $3 billion on a new Internet of things unit

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Tech giant International Business Machines Corp. (IBM) on Tuesday announced it will invest $3 billion over the next four years to build a new Internet of things unit.

IBM’s IoT unit will gather and analyze real-time data from sensor-equipped devices and smartphones and will offer the same to clients to help them manage their businesses in a better way. Over 2,000 IBM researchers, software developers and consultants will work to develop the new unit.

The Armonk, New York-based Technology Company also announced its first major alliance with the Weather Company, the owner of the Weather Channel. The alliance will see the latter moving its weather data services onto IBM’s cloud, to allow customers to use the data integrated with IBM’s analytics tools such as Watson Analytics.

“IBM and The Weather Company are forging a global partnership to bring real-time weather insights to businesses so they can make better decisions,” noted IBM Vice President of Analytics Joel Cawley.

“We’re combining IBM’s industry-leading big data and analytics capabilities with The Weather Company’s scientific expertise and cloud-based weather data distribution system. The two companies will jointly develop new real-time insights services for specific industries, including retail, insurance, energy, utilities and logistics.”

IBM expects that companies will be able to combine live weather forecasting with a range of business data to take quick decisions on adapting to customer buying patterns or supply chain issues connected to the weather.

“This deal combines the capabilities of the world’s largest and most advanced commercial weather company with the leader in big data and analytics. 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,” said David Kenny, chairman and CEO of The Weather Company.

“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.”

IBM also inked an alliance with Twitter late last year.

Formation of the new business unit is part of IBM’s decision to gradually shift away from its traditional hardware and consulting business toward spending billions to focus on analytics, cloud computing, mobile services and security. The tech giant is expecting to earn $40 billion in annual revenue from the cloud, big data, security and other growth areas by 2018.