IBM's latest cloud deal shows how it's winning business from competitors
IBM Cloud on Wednesday announced a five-year, multi-million dollar agreement with Smart Energy Water (SEW), a SaaS provider for the energy and utility sector. SEW is migrating critical workloads to IBM from another cloud provider, with plans to tap into IBM’s analytics, AI and IOT capabilities to speed up its application development. While IBM’s cloud business hasn’t grown as fast as Amazon’s or Microsoft’s, IBM says it’s now winning business from companies like SEW that began their journey to the cloud elsewhere.
“More and more, there’s a problem customers are faced with,” said Patrick Grubbs, IBM’s VP of Strategic Sales for Watson & Hybrid Cloud Platform. “Many think, ‘If I’ve chosen to move all my workloads to Azure or Amazon, it’s all going to work.’ The reality is, that’s nowhere near the truth.
IBM has made some big bets on a hybrid and multi-cloud future — including its $34 billion Red Hat acquisition — and Grubbs suggested it’s paying off.
“I find a lot of customers who have said, ‘we’ve decided to move all of our applications to’ — pick your cloud, it may be Google, Azure or Amazon — they’ve found they’ve moved the easy part,” he said. At that point, however, they find they’re left with workloads that simply don’t run on those clouds, or “the enterprise support those other clouds purport to have are nowhere near what they actually need.”
SEW is turning to IBM to provide a common global infrastructure for its enterprise web and mobile applications, which serve more than 150 utility companies. Its applications include customer engagement and mobile workforce engagement applications, online bill processing, energy efficiency tools and tools for real-time data collection and management.
In addition to helping SEW host and manage its applications, Grubbs said IBM will help the SaaS provider speed up the growth of its install base. “It’s about using IBM Cloud but also the rest of IBM,” he said, such as practitioners from IBM services or its AI and IOT offerings.
IBM’s emphasis on different services and capabilities — including hybrid and multi-cloud deployments — is especially helpful in the energy sector, which has to deal with aging infrastructure, stringent regulatory requirements and high consumer expectations. IBM Cloud also recently signed deals with TenneT Energy, Ista UK, and Hydro Ottawa.
Grubbs said the company is targeting a wide range of industries, with recent big wins in the telco business and financial services. IBM has already secured more than $3 billion in cloud deals in 2019, including a $550 million cloud services agreement with Vodafone and a deal with Westpac, one of Australia’s largest banks.