IBM to invest over $1B in Watson business unit


IBM (IBM) plans to invest over $1B to establish a new business unit for its Watson supercomputer, which the company apparently hopes will generate $10B within 10 years.

The money will include $100M for a venture-capital fund to spark more activity at the Watson Developers Cloud after IBM opened it up to external programmers last year.

The company plans to boost the headcount at IBM Watson Group to around 2,000, with many of the new recruits to be salespeople and consultants who will assist customers in working out how to use Watson.

The news follows a report that IBM has had trouble making money from Watson - the initiative had brought in less than $100M as of October, due to various projects going awry or proving to be far more difficult than expected.

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Comments (6)
  • BlueOkie
    , contributor
    Comments (10644) | Send Message
     
    Watson needs to replace Ginny
    9 Jan 2014, 10:17 AM Reply Like
  • Momintn
    , contributor
    Comments (6086) | Send Message
     
    It's pretty suspicious that someone wrote those articles yesterday saying Watson didn't make much money right before all of these Watson announcements today. Most likely it was the bears initiating the articles yesterday. Don't let them influence your investment decisions. Hedge Funds only made 9% in 2013 for their clients. They have no business using your money to short stocks of good companies.
    9 Jan 2014, 10:29 AM Reply Like
  • eisnbrg
    , contributor
    Comments (3) | Send Message
     
    Totally agree. As a big WSJ fan I think this was a shoddy set up. IBM didn't just decide yesterday to rent this new bldg. It has been in the plans for some time.

     

    I know of what I speak. Word to the wise
    9 Jan 2014, 11:48 AM Reply Like
  • wavingpine
    , contributor
    Comments (9) | Send Message
     
    IBM has a deep portfolio of intellectual property related to text analysis as well as data analysis. This seems like an initiative that will be highly differentiated in the market. It's a bold move, and setting it up as a separate business unit with an SVP will give this group more flexibility than would be likely if it was positioned as a new product announcement / brand extension within an existing group. Worth watching.
    9 Jan 2014, 11:48 AM Reply Like
  • Ronjenn
    , contributor
    Comments (25) | Send Message
     
    Instead of spending all this money trying to create interest in Watson, why not just have Watson once again appear on Jeopardy. Watson handily defeated the two best Jeopardy champions of
    all time, imagin how Watson would do against average Jeopardy contestants. Earnings could reach the stratosphere!
    9 Jan 2014, 01:30 PM Reply Like
  • jmarke
    , contributor
    Comment (1) | Send Message
     
    Nothing is ever as easy as it appears. I applaud IBM for taking a long term approach, something many companies are loath to do in a business community that seems fixated on short term gains. Investment of this sort is a strategic imperative for IBM. Bravo.
    9 Jan 2014, 07:58 PM Reply Like
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