IBM and Tech Mahindra announces partnership of $1 billion to build an ecosystem for each other

IBM and Tech Mahindra announces partnership of $1 billion to build an ecosystem for each other
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“That (hybrid cloud) opportunity is over a trillion dollars for the industry…partnership with Tech Mahindra brings in a “potential revenue of a billion dollars for each of us”: IBM chairman & CEO to PTI.

PTI reports, IBM and Tech Mahindra collaborate to create a USD 1-bn ecosystem in 3 years. Together they will deepen collaboration in areas like 5G, hybrid cloud, automation and cybersecurity.

“That (hybrid cloud) opportunity is over a trillion dollars for the industry…artificial intelligence (AI) will unlock between USD 14-16 trillion of global productivity,” said IBM Chairman and CEO Arvind Krishna.

He added that the partnership with Tech Mahindra brings a “potential revenue of a billion dollars for each of us”. About 40 percent of the revenue will be driven by Telco and 5G, powered by Hybrid Cloud. In comparison, other industries will drive 60 percent. The five strategic focus areas include 5G, automation, hybrid cloud, cybersecurity, data and AI.

“We will be adding a lot of value to each other as we build almost a billion-dollar ecosystem for each other. We are building this on the success of the customers by solving some of their critical challenges,” Tech Mahindra CEO and Managing Director C P Gurnani said.

The development is undoubtedly positive for both Tech Mahindra and IBM. In Q3 (October-December 2020 quarter), Tech Mahindra had reported USD 1.3 bn (USD 1308 mn), so an opportunity of USD 1 bn over the next 3 years means approximately one entire quarter revenue over the next 3 years just from this partnership. During the Q3 results, Gurnani stated that the deal pipeline is at a record high. The overall outlook is positive on growth as covid has accelerated technology adoption.

“We see the opportunity in three things. In the near term, we see the opportunity around hybrid cloud and AI. And then in the medium to longer term, we see an opportunity in quantum,” Krishna told reporters during a virtual briefing. He said hybrid cloud is the destination for most enterprises and governments. These organisations continue to use a mix of multiple public clouds and on-premise infrastructure for various reasons like economics and regulations.

Some of the key initiatives underway include the launch of Tech Mahindra’s Blue Marble on IBM Cloud for Telecommunications to drive 5G momentum, collaborate to grow cybersecurity business with IBM Cloud Pak for Security, and strengthen and expanding portfolio through cloud-based offerings.

Krishna said IBM is focussed on the Indian market itself and services top private sector banks and public banks, telecom services providers, industries, and it is on a “path to expand”.

“I think the Indian market is really vibrant…I really believe that remote delivery is going to offer Indian companies a great ability to expand their market share globally. But that implies that they all have to think about what is their digitalisation infrastructure and that is an opportunity for all of us to go in and help them expand,” he added.


Written by Ritik Gupta

His name is Ritik Gupta; currently pursuing law. He has always kept pride as his everything. He deems writing as not like any other hobby but a reflection of one’s intellectuality. He likes to research on the parasitic problems and then lay them down in such a means that can be of assistance to the society. He just not studies law but treats it a controversial weapon to defeat the wrong.

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