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.