Apple Joins With IBM on Business Software
CNBC’s Josh Lipton spoke with Timothy D. Cook, Apple’s chief, and his counterpart at IBM, Virginia M. Rometty about the new partnership between the two companies.
Publish Date July 15, 2014. Photo by Paul Sakuma/Feature Photo Service for IBM. Watch in Times Video
CUPERTINO, Calif. — Apple is moving up to business class. And its seatmate will be IBM.
In a deal that could deepen Apple’s sales to corporations and strengthen IBM’s position in business software, the two companies announced a wide-ranging partnership intended to spread advanced mobile and data analysis technology in the corporate world.
IBM and Apple have been working together on the venture for several months, and they are jointly working on more than 100 business software programs developed exclusively for Apple’s iOS operating system and for use on iPhones and iPads. The applications will be tailored for use in industries including retail, health care, transportation, banking, insurance and telecommunications.
“We’ve already seen some unbelievable work,” Timothy D. Cook, Apple’s chief executive, said in an interview conducted along with Virginia M. Rometty, IBM’s chief executive. Mr. Cook described the venture with IBM as “a landmark partnership” for both companies.
Neither Apple nor IBM would disclose financial terms of the deal.
Ms. Rometty said the companies planned to combine data analysis, cloud and mobile technology with Apple’s smartphones and tablets, turning the devices into decision-making tools rather than ones used mainly for email, text-messaging and contacts. The long-term goal, Ms. Rometty said, is to use the technology to “reimagine how work is done” and to “unlock value, remake professions and transform companies.”
The two executives offered few examples. They mentioned an airline pilot tapping a calculation of updated fuel use and flight paths as weather conditions change, or an insurance agent calibrating risk assessments of a potential client.
But this week was a time for the announcement, not product demonstrations, they said. The 100 or so applications will be introduced starting in the fall.
The applications, Mr. Cook said, will bring “big data analytics down to the fingertips” of Apple iPhone and iPad users in corporations. “IBM can do that,” he said, in a way that Apple cannot.
Under the partnership, IBM will serve as a sales force in corporate accounts for Apple products and provide on-site service, which have been gaps in Apple’s capabilities.
The Apple-IBM alliance in the corporate marketplace, analysts said, looks promising. “This partnership is complementary for the two companies, both in terms of their respective strengths and weaknesses,” said Frank Gens, chief analyst for IDC, a research firm.
Even without a direct sales force and service, Apple’s iPhones and iPads are used by over 92 percent of the Fortune Global 500 companies, Mr. Cook said. But there is still a vast untapped market for Apple, he said, by selling more of its products to large companies and reaching the wider corporate market.