Weather Industry Shakeup With IBM’s Purchase Of The Weather Company

IBM Weather Company

Looking to expand its “Internet of Things,” IBM announced today that it will purchase the digital assets of the Weather Company which include: WSI, Weather Underground apps, and weather.com.

Forget about the Weather Channel for now

IBM’s CEO Ginni Rometty, has promised shareholders and other stakeholders to continue to move Big Blue into the “big data” that she believes is the future of the company given slumping software sales and information-technology services. Part of that shift is a promised $3 billion commitment to develop Internet of Things services.

In a deal whose financial terms were not disclosed, IBM’s purchase of the Weather Company’s digital assets will give IBM access to the Weather Company’s “big data” platform which not only powers all the Weather Company’s apps but also provides data for well over 25 billion third-party requests each day.

IBM’s purchase will also help bolster its cognitive computing by making the Weather Company’s “big data” system available to IBM’s Watson division. Watson gets considerably “smarter” the more it has access to huge amounts of data. Earlier this year, IBM splashed out $1 billion on Merge Healthcare to add medical imaging data and technology to Watson’s computing power, specifically, the Watson Health Cloud business unit.

Given the sheer weight of IBM’s computing power, the Weather Company can focus all its energy away from the Weather Channel who at the risk of understatement now faces an uncertain future.

IBM’s acquisition: What’s next for the Weather Channel and its employees?

Firstly, the Weather Channel will now have to pay IBM for access to weather data. Something a company that launched the Weather Company in 1982 won’t feel great about having to do. Worse, if you consider that the Weather Channel is still owned by Bain Capital, Blackstone Group and NBC Universal who have made no qualms against openly shopping the Weather Channel following its problems with both DirecTV and Verizon in recent years. The latter of the two ultimately dropped the Weather Channel altogether from its FiOS programming going with its competitor AccuWeather.

“The Weather Channel operates as a distinct and separate business with its own leadership team, which enables this to be a smooth and seamless transition,” said Shirley Powell, chief communications officer for the Weather Company. “We believe a bright future lies ahead for the television business as the most trusted source of weather information.”

While that sounds hopeful, it will presumably come as little relief to the employees of the beleaguered Weather Channel.

For exclusive info on hedge funds and the latest news from value investing world at only a few dollars a month check out ValueWalk Premium right here.

Multiple people interested? Check out our new corporate plan right here (We are currently offering a major discount)



About the Author

Brendan Byrne
While studying economics, Brendan found himself comfortably falling down the rabbit hole of restaurant work, ultimately opening a consulting business and working as a private wine buyer. On a whim, he moved to China, and in his first week following a triumphant pub quiz victory, he found himself bleeding on the floor based on his arrogance. The same man who put him there offered him a job lecturing for the University of Wales in various sister universities throughout the Middle Kingdom. While primarily lecturing in descriptive and comparative statistics, Brendan simultaneously earned an Msc in Banking and International Finance from the University of Wales-Bangor. He's presently doing something he hates, respecting French people. Well, two, his wife and her mother in the lovely town of Antigua, Guatemala. To contact Brendan or give him an exclusive, please contact him at theflask@gmail.com

Be the first to comment on "Weather Industry Shakeup With IBM’s Purchase Of The Weather Company"

Leave a comment

Your email address will not be published.