IBM has signed an agreement with Francisco Partners to acquire the assets of The Weather Company as part of a streamlining effort. This includes all apps from The Weather Company such as Weather Channel mobile, Weather.com, Weather Underground and Storm Radar, the group announced on Tuesday. The offers for broadcasting, media and aviation as well as advertising technology and data solutions are also affected.
In addition, IBM will contribute its scientific forecasting services and technical platform to Francisco Partners. The acquisition is expected to close by the end of the first quarter of 2024, subject to regulatory approvals.
IBM wants to keep the sustainability software business, such as the Environmental Intelligence Suite (EIS). The weather data from The Weather Company will continue to be used by EIS to cover various climate-related use cases, such as for the geospatial AI model offered in the AI and data platform Watsonx.
IBM bought The Weather Company in 2016 for $2 billion and over the past eight years has launched several apps and services for local weather forecasts and improved weather forecasts based on data from airplanes and smartphones.
improve financial situation
But IBM’s financial position isn’t doing particularly well. In the most recent fiscal quarter, IBM achieved sales of $15.5 billion, down 0.4 percent. The mainframe business declined 30 percent and the infrastructure business fell 14.6 percent to $3.6 billion. It also acquired Apptio, a platform for managing business expenses and assets, in June for $4.6 billion. That had torn an additional hole in the cash register. All of this puts pressure on IBM to improve its financial position.
In early 2023, IBM announced that it would cut around 3,900 jobs, mainly in the Watson AI division and in the infrastructure business. IBM Health has already been sold in parts to Francisco Partners – for an allegedly around one billion dollars. It is said that IBM wants to achieve a similar price for The Weather Company. However, IBM and Francisco Partners do not provide precise information about the deal.
However, Francisco Partners has some plans for the new acquisition and plans to invest in the weather platform and put more resources into it. It is to be expanded in such a way that it “goes beyond pure weather forecasting”. This refers to extensions aimed at health and well-being. Francisco Partners also wants to expand its business with advertising and subscription media companies.
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