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October 28, 2015

IBM Buys Weather Company, Forecasts Watson Expansion

IBM, which earlier in the week announced it was launching a new data analytics service with Twitter and the Weather Company, upped the ante on Wednesday (Oct. 28) when it disclosed it would acquire most of the latter’s assets that include a far-flung weather sensor network generating huge meteorological datasets.

IBM (NYSE: IBM) said it would acquire the Atlanta-based Weather Company along with other cloud-based web properties that include and Weather Underground. Excluded from the sale is the Weather Channel, which will license weather forecast data and analytics from IBM under a long-term deal.

The acquisition would allow IBM to combine a huge trove of weather data with its Watson cognitive and analytics platform to create new business intelligence use cases.

IBM did not disclose the purchase price, but published reports said it was paying more than $2 billion for Weather Company assets.

The partners noted that the Weather Company’s data platform, handles 26 billion inquiries to its cloud-based services each day. IBM said the deal would extend the reach of its cloud data services capabilities while expanding the Weather Company’s business capabilities. “The Weather Company’s cloud-based data platform will allow IBM to collect an even larger variety and higher velocity of global datasets, store them, analyze them and in turn distribute them… across the Watson platform,” IBM said.

Earlier in the week during a company event, IBM announced a new cloud analytics service in collaboration with Twitter (NYSE: TWTR) and the Weather Company. The partners said the analytics service would use open datasets along with corporate data. One goal is to organize unstructured and streaming data for use with business intelligence tools. The partners said they are targeting retail, insurance as well as media and entertainment.

Given the increase in extreme weather, insurers are particularly interested in leveraging big data to help limit their financial exposure to weather-related risks.

The new Insight Cloud Services announced on Monday (Oct. 26) includes the release of four new APIs for developers along with bundled datasets from the Weather Company and IBM tailored to specific industries and available on the IBM Cloud. Possible applications include allowing insurers to alert policyholders ahead of severe weather, help utilities plan for weather-related service outages and aid local government in developing emergency plans in advance of severe weather.

The cloud services collaboration also includes an analytics package that can be tailored for specific industries, IBM said.

The data analytics deals have “everything to do with how many connections we can make within sources of data, and how fast those connections are growing,” Joel Cawley, general manager of IBM’s Information and Insights as a Service unit noted in a statement.

The Weather Company acquisition also allows IBM to combine Watson with a new group of weather data scientists, “precision forecasting capabilities” and a separate cloud platform capable of crunching and distributing huge meteorological datasets in real time.

“We see the next wave of improved forecasting coming from the intersection of atmospheric science, computer science and analytics,” added Weather Company CEO David Kenny. The partners said they would seek to improve the precision of weather forecasts while expanding Watson’s Internet of Things capabilities “by enabling the integration of global atmosphere and weather insights with enterprise information.”

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