The Cloud

IBM Bets on Data Analytics With Weather Co. Deal

The acquisition of the digital assets of the Weather Channel's parent company gives IBM's Watson division access to a vast "big data" platform.
Katie Kuehner-HebertOctober 28, 2015

IBM said Wednesday it had agreed to buy the digital assets of the Weather Channel’s parent company, providing its Watson artificial intelligence division with a vast new source of data to analyze.

The Wall Street Journal reported that the deal could be valued at more than $2 billion. IBM will acquire Weather Co.’s website and app, intellectual property, infrastructure and data but not the flagship Weather Channel.

“The Weather Co. acquisition extends a bet that so-called cognitive computing by IBM’s Watson division, which draws insights from vast amounts of data, will drive future growth,” Bloomberg said.

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Weather Co. has the fourth-most visited mobile app in the U.S. and handles 26 billion inquiries to its cloud-based services daily, generating about 4 GB of data per second, according to TechCrunch.

IBM had access to the Weather Channel’s data under an earlier agreement. The deal announced Wednesday gives IBM access to the underlying “big data” platform.

“This powerful cloud platform will position IBM to arm entire industries with deep multi-modal insights that will help enterprises gain clarity and take action from the oceans of data being generated around them,” John Kelly, a senior vice president at IBM, said in a news release.

Predictive weather analytics, for example, could be coupled with real-time analysis of social media postings, detailed understanding of transportation flows and other related data to help retailers and distributors finely tune and maintain availability of vital goods in times of need, IBM said.

Ginni Rometty, IBM’s chief executive, has been seeking to bolster its cloud and data analytics offerings amid a stock decline and multiyear revenue slump. The company this year purchased Merge Healthcare for $1 billion to add medical imaging technology and data to the Watson Health Cloud business unit.

Weather Co. is owned by a consortium that includes private-equity firms Bain Capital and Blackstone Group. It bought the company in 2008 for roughly $3.5 billion.

“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 [Internet of Things] capabilities,” said David Kenny, chief executive of Weather Co.