IBM Creates Cloud-Computing System for NATO Command

International Business Machines Corp., the world’s biggest computer-services provider, is building a cloud-computing system for NATO in the first such deal for the international military alliance.

The software and hardware will let NATO more quickly collect and analyze data, such as military intelligence in Afghanistan, said E.J. Herold, head of the project for IBM. NATO’s military command department in Norfolk, Virginia, will use the technology first, with the possibility it will expand to other divisions, he said. Terms of the accord weren’t disclosed.

IBM gains a foothold for similar projects for NATO’s other departments, as well as its 28 member countries. The Armonk, New York-based company is betting cloud computing, which helps customers save money by letting them store and access data via the Internet, will be a $3 billion business by 2015.

“It’s a first step in the door at this international organization,” Herold said in an interview yesterday. “With 28 member nations who are all having equal say in doing things, by definition everything you do becomes more complex.”

IBM will manage the North Atlantic Treaty Organization’s data from inside the Norfolk base, in a so-called private-cloud model, which lets customers put information on servers within their own security systems. The system will help the military command pull together information from sources such as radar systems, cameras or infrared images that had been separated.

“It makes it easier to share information, especially in time-sensitive situations, like combat,” Herold said. “It makes it easier for commanders to understand the situation and then make a decision.”

IBM rose 21 cents to $145.95 at 4 p.m. in New York Stock Exchange composite trading. The shares have climbed 11 percent this year.

To contact the reporter on this story: Katie Hoffmann in New York at khoffmann4@bloomberg.net

To contact the editor responsible for this story: Peter Elstrom at pelstrom@bloomberg.net

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