IBM Corp. (IBM) recently unveiled its new cloud platform called IBM SmartCloud Service Delivery for Electronics. The SmartCloud platform helps manufacturers to manage electronic devices and provide related customer services within a very short span of time. Its flexible, pay-per-use cost structure significantly lowers infrastructure, maintenance and development costs and at the same time efficiently uses IT resources.
IBM’s SmartCloud platform helps manufacturers and application providers to gain new customer insight by analysing the data stored in the cloud. By analysing consumer behaviour, needs and preferences, service providers will be able to offer more personalized applications and services.
Marketers will also be able to target the right audience through effective advertisement. This will not only boost their user base but will also drive top-line growth going forward.
These inherent advantages of the SmartCloud compelled Philips and TP vision to choose IBM as the service provider for the Philips Smart TV platform. Amsterdam-based TP vision is the exclusive brand licensee of Philips TV in a number of European countries such as Russia and also serves electronics markets in India, Brazil and Argentina.
In a separate development, IBM and Vodafone Group PLC (VOD) also signed a partnership that will integrate cloud computing with mobile communications in order to manage electronic devices remotely (through the use of Internet). The rapid adoption of smartphones along with cloud computing presents new business innovation opportunities in the electronics market, which both the companies expect to grab through their technological partnership.
The combination of Vodafone’s Machine-to-Machine (M2M) technology and IBM SmartCloud platform will allow users to effectively manage electronic devices such as washing machines through the use of their smartphones. In addition, manufacturers will be able to collect valuable information about consumer behaviour, which will help them to improve product development and customer service.
We believe that IBM stands to benefit from its cloud computing initiatives going forward. The new platform is expected to boost its customer base in the electronics market, driving revenue growth over the long term. Moreover, accretive acquisitions will also boost its growth opportunities going forward.
We believe that IBM remains well positioned for long-term growth based on its four key growth initiatives: smarter planet, growth markets, business analytics and cloud computing, which are expected to deliver at least $50 billion in revenues by fiscal 2015. We believe that IBM’s strong product pipeline and expansion into emerging markets will help it to achieve this target going forward.
We have a long-term (6-12 months) Neutral recommendation on IBM. Currently, IBM has a Zacks #2 Rank, which translates into a short-term Buy rating.Read the Full Research Report on IBM
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