UK-based multinational telecommunications company Vodafone and leading tech company IBM have formed a wide-ranging partnership to jointly pursue solutions in a variety of developing technology sectors, reports TechCrunch.
IBM will supply Vodafone’s business-to-business (B2B) unit with cloud computing capabilities and space along with other managed services over the next eight years as part of a $550 million deal. The agreement should help drive forward both companies’ digital solutions and could inspire more wide-ranging collaborations between tech leaders and telecoms.
The deal shakes out in two major ways:
- The first piece of this arrangement amounts to a joint venture between the two parties. IBM and Vodafone employees will work together at a shared site to develop technology and solutions that merge their respective expertise. The goal is to use knowledge-sharing to create novel solutions that fill gaps between existing products or move the market forward altogether. Given Vodafone’s extensive network operations — it boasts networks in more than 25 counties — and IBM’s experience with AI and cloud, the companies are in a good position to wed 5G, AI, and IoT to create innovative solutions.
- The other half is transactional but still mutually beneficial. IBM has the experience and capacity to support Vodafone’s managed services through its IBM Cloud infrastructure. That cloud will, in turn, allow Vodafone to improve the quality and value of its B2B products and solutions. And the managed services unit will be in position to leverage the fruits of the joint research venture when they ripen.
Wide-ranging partnerships between tech leaders and telecoms can offer benefits for both parties, but can also lull telecoms into complacency. Different cloud providers and technology vendors generally offer comparable baselines.
Where they usually vary is in their specific areas of expertise — one potential partner could emphasize edge computing AI capabilities, for instance, while another is more apt to suggest and pursue enterprise AR and VR solutions.
Companies of all stripes are racing to develop solutions that utilize forthcoming 5G networks, and executives in the telecom space see a variety of potential revenue opportunities. What telecoms need to be wary of, though, is restricting themselves to one path through a partnership that might leave them blind to other opportunities.
While that doesn’t appear likely with the IBM/Vodafone partnership, it’s important for telecoms to stay abreast of wider industry trends rather than just developments within their ventures.
Get the latest IBM stock price here.
Published at Tue, 22 Jan 2019 16:08:42 +0000