IBM Links French Rail, BMW Sports Cars to Widen Watson's Appeal

  • Germany is new global headquarters of connected-device effort
  • Watson striking deals with autos, industry for AI service

IBM’s artificial intelligence arm is striking deals with the French railway to help it head off costly repairs, and with the world’s largest car-parts maker Bosch to create cars and appliances that can self-order worn parts.

The deals with France’s SNCF national rail system, Robert Bosch GmbH, and payment processor Visa Inc., were announced Thursday alongside the opening of IBM’s $200 million global headquarters for industrial applications of software in Munich, and are part of a push to spread its Watson computing service in Europe.

Watson and IBM’s $18 billion “cognitive computing” group are a rare bright spot amid a years-long slump in sales and earnings, and the company is counting on the unit as its long-term growth driver. IBM has called Watson a connector across all its services and software and has announced a large number of deals to build out Watson-related projects.

The French railway is monitoring 200 Parisian trains at a time for problems with doors or air conditioning. Bosch plans to use Watson as part of cloud-computing software that can schedule software updates for cars or let washing machines automatically reorder detergent. Visa and IBM are teaming up to let internet-connected products process payments, so a car owner could schedule a service appointment or a runner could order new shoes right from a fitness device.

A dozen BMW engineers are also working with International Business Machines Corp. on site to outfit the auto-maker’s $138,000 i8 hybrid sports car with controls that respond to a drivers’ voices and make recommendations for route changes and stops based on fuel levels and the weather.

“It’s an area of great interest to us: this relationship of people to cars, people to homes, to hospitals,” said Bret Greenstein, vice-president for the Watson internet of things platform at IBM. “The last two years was exploring, pilots, kicking tires, just as many of us did in the early days of the web. This is the year of deployment and getting use and value out of IoT.”

Bot Wars 

The internet of things -- shorthand for a world of cars, appliances and other objects that communicate about their status to head off repairs, give users timely information or automatically order spare parts, comes against the backdrop of Germany’s Industry 4.0 initiative, meant to digitize the country’s automotive and manufacturing base and better position it against Silicon Valley competitors. 

Locating in Munich gives IBM and its rivals proximity to Siemens AG, BMW AG and Audi, and large insurers including Munich Reand Munich Re. IBM plans to have 1,000 developers, researchers and business staff at its new skyscraper digs in the city’s north. 

It’s not alone. Microsoft opened a city-center office last September with about 1,900 workers. Google last year opened a development center near the historic Marienplatz.

SAP SE, the German software giant, is also spending 2 billion euros ($2.1 billion) by 2021 to develop tools for connecting factories, ships, trucks and wind farms.

“We’re not an industrial engineering company like a GE or a Siemens,” said John Kelly, senior vice president for cognitive solutions at IBM. “We’re an IT company so our clients view us as a partner and not a competitor. We’re viewed very much as a neutral player.”

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