Data Analysis

IBM, SAP Team Up on Artificial Intelligence

ibm watson source Matthias Balk dpa
IBM Watson trying to second guess the future.
  • Why it matters

    Why it matters

    IBM is hoping that its new artificial intelligence programs will help companies harvest data on their customers and boost their bottom line.

  • Facts


    • IBM has opened a new office in Munich, where 1,000 developers will program solutions for the Internet of Things.
    • It has set up a new entity, IBM Watson, which tries to make sense of unsorted data.
    • In 2015, cloud computing, data analysis, IT security and mobile applications comprised 35 percent of IBM’s total sales of $81.7 billion.
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Was the driver distracted? Or did he deliberately damage his car? It’s a question insurance companies face every day. Deliberate deception is a contributing factor in one out of ten insurance claims.

A joint project by IBM and SAP is intended to make estimating easier for claims adjusters in the future. The two tech giants are developing a program that searches through large numbers of damage reports to uncover irregularities. It is one of several ideas with which the two companies are working on to help their clients benefit from digitalisation.

IBM estimates that it is investing “several million euros” in the first year to the venture. The fraud sleuth is one of the pilot projects, and it embodies the hopes IBM is attaching to the partnership. The tech industry veteran is in the process of reinventing itself once again. Its new division IBM Watson is playing a key role in this, with artificial intelligence seen as the key business of the 21st century. But marketing is still in its infancy, and the company isn’t even breaking down sales figures yet. To succeed, IBM needs partners like SAP.

IBM is currently obsessed with Watson, and sees huge potential for its cognitive computer solutions, from customer service to weather forecasting, and from cancer treatment to maintenance. “It’s the beginning of a new era, the cognitive era,” Chief Executive Officer Ginni Rometti said at the Consumer Electronics Show (CES) in January. IBM is investing heavily in this future. It has already spent several billion dollars to acquire companies in the healthcare sector alone. IBM also opened an office in Munich, where 1,000 developers will program solutions for the Internet of Things, using Watson as the central element.

IBM is buying hope with these investments. Demand is shrinking for its complete solutions, consisting of servers, memory systems and software, and accompanied by services. Many customers rely on cloud computing and obtain standard services through the Internet, requiring little advice. Sales have been shrinking for the last 15 quarters, declining to about $82 billion (€72 billion) in the last fiscal year.

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