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IBM in advanced talks to acquire The Weather Co.’s digital assets for $2B
IBM is said to be close to acquiring the digital and data assets of The Weather Company, with talks said to be at an advanced stage, according to The Wall Street Journal. The paper cites the usual “people familiar with the situation” in its report, and says the $2 billion deal could be announced later today.
IBM would acquire The Weather Company’s digital businesses, such as its official website and application, infrastructure and data, and its intellectual property. However, the deal would not include its traditional weather TV channel.
The WSJ‘s sources said IBM has expressed a keen interest in WSI, The Weather Company’s forecasting group that collects weather data which is then licensed to third parties ranging from insurance firms to airlines and more.
This isn’t the first time we’ve heard rumors of someone buying The Weather Company. The WSJ says Google turned down the opportunity to buy the company’s digital assets back in 2014, while Re/Code also reported on rumors IBM might make a bid just last month.
The deal makes sense in light of IBM’s existing relationship with The Weather Company. Under an agreement struck earlier this year, IBM’s Watson artificial intelligence service performs analytics on The Weather Company’s data in order to package and sell weather data that’s tailored for different industries. For example, insurers might use weather alerts to forewarn their customers of imminent severe weather such as hail storms, giving them time to take preventative measures and save millions of dollars in annual claims.
The Weather Company is currently owned by a consortium of companies that includes Comcast Corp.’s NBCUniversal, as well as private-equity firms like Bain Capital LLC and Blackstone Group LP.
If the deal goes ahead, sources say that Weather Company CEO David Kenny would join IBM upon completion.
Kenny joined David Vellante and Paul Gillin, cohosts of theCUBE from the SiliconANGLE Media team, at IBM Insight 2015. Kenny talked about the company’s business model, which is based on selling bits, not forecasts.
Image credit: Nils Geylen via flickr.com
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