IBM lands $700M cloud computing contract with Bombardier

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Troubled Canadian transportation giant Bombardier Inc. has just inked a six-year, $700 million deal with IBM Corp. to use its cloud services as part of a larger restructuring initiative.

Last year, Bombardier said it was laying off more than 14,000 of its staff worldwide, following a $2 billion budget overrun and a two-year delay of its C-Series commercial jetliner, which finally entered into service last year. The deal will see Bombardier use IBM Services and IBM Cloud Management to power its IT in 47 countries, and will be one of Big Blue’s largest partnerships in Canada, the companies said.

Bombardier launched a five-year turnaround plan in 2015 that aimed to reduce costs and boost productivity at the firm. The partnership with IBM is a part of this plan, as it will allow the company to offload cloud management and focus on its core competencies, the firm said.

“As part of our turnaround plan, Bombardier is working to improve productivity, reduce costs and grow earnings,” Sean Terriah, chief information officer of the Aerospace and Corporate Office at Bombardier, said in a statement. “This IT [information technology] transformation initiative will help us better integrate globally to create a best-in-class IT organization. With IBM, we will transform our service delivery model to focus on our core competencies, and leverage the best practices of our strategic partner across our infrastructure and operations.”

That makes IBM a suitable partner, given that it has become something of a specialist in offloading services jobs to locations with low-cost labor so it can cut staff expenses.

IBM isn’t alone in targeting enterprises north of the U.S. border. Last week, its rival Microsoft Corp. said electronic signature technology provider DocuSign Inc. had agreed to use its Azure Cloud data centers in Quebec City and Toronto in order to comply with local data regulations and expand its footprint in Canada.

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