IBM Inc. Corporation (NYSE:IBM) and Vodafone are launching a new venture that aims to boost Europe’s race for 5G, A.I. as well as cloud capabilities. Both companies have their ambitions with Vodafone having an objective in Europe while IBM focuses on managing hybrid, multi-cloud environments.
Ends of the Partnership
Apparently, the two companies have combined their respective expertise in computing and connectivity power in a bid that is aiming to accelerate the introduction of new applications which will be unlocked by new technologies like 5G, Augmented Reality (AR), Artificial Intelligence (AI) and Software Defined Networking (SDN) in Europe.
The new venture will allow Vodafone to have access to all IBM’S cloud servers as the London-based telecommunication provide mobile infrastructure such as 5G to Big Blue.
In a phone interview with CNBC, Michael Valoochi, general manager at IBM is confident that the partnership between IBM and Vodafone is game-changer for the customers.
The State of Europe
At the moment, Europe is lagging behind China and the United States in next-generation technologies such as 5G. According to CCS, a technology research company, it is estimated that Europe is to capture only 9% of the globe’s 5G subscribers come 2023.
Therefore, the partnership between IBM and Vodafone could play a significant role in accelerating Europe’s foothold in such markets like 5G and cloud computing. Currently, the US companies are the biggest players in the cloud market inside Europe.
The latter part of the partnership is a classic one as both parties will bring some stuff on the table-the employees of both companies will move to a separate office that seems to be the “neutral” territory for all together.
The former part, however, sees Vodafone paying IBM $550 million over the 8-year agreement. That price tag alone indicates that the dal is definitely a big one for the companies. The companies also are to co-develop digital solutions around connectivity and cloud. Nevertheless, the new venture is to operate independently out of London and will not list a separate company.
The partnership perhaps may have come at a crucial time for Europe as well as for the companies. Vodafone is on the race to introduce 5G services across Europe and IBM convincing the market that hybrid cloud is probably the right one.